2008 (8) TMI 370 - HC - Central Excise

Rectification of mistake - Appeal to High Court - Held that - As seen from the extract of the Tribunal s order, it is apparent that the Tribunal has merely recorded prima facie opinion, but at the same time, the Tribunal has also observed after using the term however , that the matter is remanded back to the original authority to redetermine. Therefore, it is not possible to state that, any question of law, as proposed or otherwise, much less a substantial question of law, arises from the impugned order of the Tribunal dated 5-6-2006. Insofar as the second order of the Tribunal is concerned, the Tribunal has merely stated that, in a Rectification of Mistake Application, the Tribunal is not entitled to re-appreciate the case on merits and thus, rejected the application. In relation to this finding, suffice it to state that the position in law is well settled. The Tribunal is entitled to correct an apparent error on record. If the Tribunal has come to a conclusion that no error apparent on record exists, the High Court cannot determine merely on the basis of an application moved by the revenue that there is an error apparent on record which the Tribunal ought to have rectified. There has to be some evidence beyond an application. Therefore, it is not possible to state that, any question of law, as proposed or otherwise, much less a substantial question of law, arises from the impugned order of the Tribunal dated 5-12-2006. Accordingly, the appeal is dismissed.

Summary

Issues involved:
Challenge to Tribunal's order on deemed credit under Notification No. 6/2002-C.E., remand of the matter to the original authority, rejection of Rectification of Mistake Application by Tribunal.

Analysis:

1. The appellant-Revenue challenged the Tribunal's order on the deemed credit issue under Notification No. 6/2002-C.E. The Tribunal found that the appellant received grey fabrics for job work, which were sent for bleaching and mercerizing. The Tribunal noted that the Revenue did not challenge this fact before the Commissioner (Appeals). The Tribunal remanded the matter to the original authority to redetermine the eligibility for credit. The Tribunal emphasized that issues like cotton fabrics not being in the notification and job working procedures not being intimated do not deny the benefits of job work. The Tribunal's decision was based on the case of M.Tex v. CCE, 2001 (136) E.L.T. 73, approved by the Apex Court. The Tribunal set aside the orders and remanded the matter for further determination.

2. The Revenue filed a Rectification of Mistake Application challenging the observation that the fact of receiving grey fabrics for job work was not challenged. The Tribunal rejected the application, stating that it cannot re-appreciate the case on merits in a rectification application. The High Court upheld this decision, stating that the Tribunal can correct only apparent errors on record. The High Court found no substantial question of law arising from the Tribunal's order on the rectification application.

3. The High Court clarified that the Tribunal's remand order did not prejudice either side. The Tribunal's decision to remand the matter for redetermination did not give rise to any substantial question of law. Therefore, the High Court dismissed the appeal against the Tribunal's orders. The High Court affirmed the Tribunal's authority to remand the matter for further determination without prejudice to any party.