2018 (7) TMI 236 - AT - Central Excise

Abatement of duty for the period of closure - Rule 96ZP(2) of Central Excise Rules - It is the case of the Revenue that the assessee had opted to discharge their duty liability under Rule 96ZP(3) read with section 3A of the Act and accordingly they are not entitled to abatement of duty - Held that - On close rending of Rule 96ZP, it is noted that Rule 96ZP (2) allowed to claim abatement of duty during the closure period - In the present case, the appellant opted to pay duty under Rule 96ZP(3) at the rate of ₹ 300/- per MT Rule 96ZP(3) did not allow abatement of duty. It is well settled that once the appellant opted to exercise the option of payment of duty under Rule 96ZP (3), they are not entitled ti retract their stand. The appellant is not entitled to abatement/proportionate reduction of duty - appeal dismissed - decided against appellant.

Summary

Issues:
- Appellant's claim for abatement of duty during factory closure period under Rule 96ZP(2)
- Applicability of abatement scheme to assesses opting to pay duty under Rule 96ZP(3)

Analysis:
1. The Tribunal noted that the appellant started trial production but closed down due to erratic quality of the final product, resulting in the factory being closed from 13.11.1998 to 31.12.1998. The dispute arose regarding the appellant's claim for abatement of duty for the closure period. The Revenue argued that since the appellant opted to pay duty under Rule 96ZP(3), they are not entitled to abatement of duty under Rule 96ZP(2). The Ld. Commissioner held that proportionate abatement of duty for the closure period is not admissible.

2. Despite multiple notices, the appellant did not appear before the Tribunal, leading to the case being taken up for disposal. The Revenue contended that the abatement scheme does not apply to assesses opting for duty payment under Rule 96ZP(3). The relevant provisions of Rule 96ZP were cited, emphasizing the conditions for claiming abatement under Rule 96ZP(2) during a factory closure period.

3. Upon a thorough examination of Rule 96ZP, the Tribunal observed that while Rule 96ZP(2) allowed for abatement of duty during closure periods, the appellant had chosen to pay duty under Rule 96ZP(3) at a specified rate per metric ton. It was established that Rule 96ZP(3) did not provide for abatement of duty. The Tribunal reiterated that once an appellant opts for duty payment under Rule 96ZP(3), they cannot retract their decision. Consequently, the Tribunal upheld the adjudicating authority's decision, denying the appellant's claim for abatement.

4. Based on the analysis, the Tribunal concluded that the appellant was not entitled to abatement or any proportionate reduction of duty. Therefore, the appeal filed by the appellant was dismissed. The operative part of the order was pronounced in open court, finalizing the decision regarding the appellant's claim for abatement of duty during the factory closure period under Rule 96ZP(2).