2008 (11) TMI 242 - HC - Central Excise

Non acceptance of appeal by the Tribunal Appeal for an amount less than Rs. 50,000 issue of interpretation of notification - held that - The Tribunal has the discretion not to admit an appeal under the aforesaid clause (i) of second proviso where the difference in duty involved or the duty involved does not exceed rupees 50,000/-. In the present case, the question did not pertain to the amount of duty involved but it related to the interpretation of notification dated 10th June, 2003 in the context of the claim of the appellant that he having added to the machinery was entitled to the exemption granted under the aforesaid notification. The argument merits rejection on another count also. The Tribunal has nowhere mentioned that the appeal was not being admitted in exercise of the discretion vested in it, under second proviso to Section 33-B(1) of the Central Excise Act, 1944.

Summary

Issues involved:
1. Maintainability of the appeal filed before the Customs Excise and Service Tax Appellate Tribunal, New Delhi.

Detailed Analysis:
The appeal in question was filed by M/s. Jai Ambey Containers Pvt. Ltd. against the order dated 20-2-2008 passed by the Customs Excise and Service Tax Appellate Tribunal, New Delhi, Principal Bench, Court No. 1. The Tribunal had rejected the appeal in limine on the grounds of maintainability, stating that the order of the Commissioner (Appeals) under challenge was not appealable as it did not fall within the ambit of sub-section (1) of Section 35-B of the Central Excise Act, 1944. An interim relief application was allowed, staying the operation of the Commissioner (Appeals) order.

Upon hearing arguments from both sides, the High Court admitted the appeal based on the substantial question of law regarding the maintainability of the appeal before the Tribunal. The Court noted the relevant facts, where the appellant had set up an Industrial Unit in the Industrial area of Kala Amb, claiming exemptions under a notification for substantial expansion. The claim was rejected by the Assistant Commissioner, and subsequent appeals were dismissed by the Commissioner (Appeals) and the Tribunal.

The High Court found the Tribunal's view to be incorrect as the order passed by the Commissioner (Appeals) was under Section 35-A of the Central Excise Act, 1944, making it appealable under Section 35-B(1)(b) to the Tribunal. The Court rejected the argument that the Tribunal had the discretion to refuse to admit the appeal under the second proviso of sub-section (1) of Section 35-B, as the case involved interpretation of a notification and not just the duty amount. The Court held in favor of the assessee-appellant, setting aside the Tribunal's order and remanding the case for a decision on merits. The Court directed that the operation of the Commissioner (Appeals) order should not be enforced pending the Tribunal's decision on the application for interim relief.

In conclusion, the High Court found the appeal maintainable before the Tribunal and ruled in favor of the appellant, directing a reevaluation of the case on its merits by the Tribunal.