2004 (3) TMI 101 - AT - Central Excise

Summary

Issues involved:
1. Interpretation of Rule 173L of Central Excise Rules, 1944 regarding the quantum of refund for goods cleared after re-processing/re-conditioning at Nil rate of duty under an exemption notification.

Analysis:
The judgment by the Appellate Tribunal CESTAT, New Delhi involved a dispute regarding the interpretation of Rule 173L of Central Excise Rules, 1944 concerning the amount of refund to be granted for goods cleared after re-processing at Nil rate of duty under an exemption notification. The Tribunal referred to conflicting decisions in previous cases to resolve the issue. In the case of Collector of Central Excise v. Metazinc (India) Ltd., the Tribunal allowed a refund for duty paid goods cleared for export after re-processing. However, in the case of Commissioner of Central Excise, Calcutta-IV v. Fort William Co. Ltd., it was held that no refund would be granted for duty paid goods cleared at Nil rate of duty under an exemption notification.

The main contention revolved around the interpretation of the term "payable" in Rule 173L(iv). The assessee argued that "payable" should be understood as duty leviable as per the Tariff rate, as the goods were only exempted from payment of duty. On the other hand, the Revenue contended that "payable" refers to duty actually paid on the re-processed goods. They relied on a decision by the Delhi High Court in the case of Orient Paper Mills Limited, which was upheld by the Supreme Court. The Tribunal analyzed the term "payable" in light of these decisions to determine the correct interpretation.

The Tribunal concluded that the term "payable" in Rule 173L(iv) should be understood as the duty actually paid on the goods. Citing the decision in the Orient Paper Mills case, the Tribunal held that "payable" must mean what is actually paid, as per the law. Therefore, the Tribunal rejected the assessee's argument and upheld the decision in the case of Commissioner of Central Excise, Calcutta-IV v. Fort William Co. Ltd. as the correct interpretation of the rule. As no other issues were involved, the appeal was disposed of accordingly, in favor of the Revenue, setting aside the impugned order.