2001 (9) TMI 204 - AT - Central Excise

Summary

Issues involved: Alleged non-payment of Central Excise duty on steel structures used for setting up a Rolling Mill, violation of various Central Excise Rules, imposition of penalty, and time-barred demand.

Non-payment of Central Excise Duty and Violation of Rules:
The appellants were issued a show cause notice for manufacturing/fabricating industrial shed without paying duty on steel structures, which were classified under Chapter Heading 7308.90 of the Central Excise Tariff Act, attracting duty at 15% ad valorem. The notice alleged violation of Rule 174, Rule 173B, Rule 173C, Rule 173G, Rule 9, and Rule 52A of the Central Excise Rules, 1944. The Commissioner held the noticee No. 1 liable to pay duty and imposed a penalty under Rule 9(2) and Rule 173Q, while dropping proceedings against noticee No. 2.

Appeal and Legal Considerations:
The appeal challenged the Commissioner's order, arguing that the steel structures were not subject to duty based on previous judgments. The Commissioner had determined that the steel structurals were manufactured goods liable for excise duty, citing evidence of fabrication and marketability. However, the appellants contended that the demand was time-barred, as the goods were fabricated between January 1988 and June 1988, while the show cause notice was issued in June 1993.

Decision and Ruling:
The Tribunal considered the arguments and legal precedents cited by both parties. While affirming that the steel structures were indeed liable for Central Excise duty, the Tribunal found the demand to be time-barred due to the significant period between fabrication and the issuance of the notice. Consequently, the appeal was allowed, setting aside the Commissioner's order regarding duty payment and penalty imposition.