2002 (2) TMI 266 - AT - Central Excise

Summary

Issues:
- Dispute over duty payment for MS rods and bars: ACP vs. actual production under Central Excise Act, 1944.

Analysis:
The dispute in this case revolves around whether the manufacturers of MS rods and bars are obligated to pay duty based on the annual capacity fixed by the Commissioner or on the actual production as per Section 3A(4) of the Central Excise Act, 1944. The Commissioner upheld the duty demand against the appellants for not paying duty as per the ACP fixed. However, the appellants argued that since their actual production was below the ACP, their duty liability should be recalculated based on Section 3A(4).

The Appellate Tribunal referred to a previous case, S.G. Multicast Pvt. Ltd. v. CCE, where it was established that if the actual production is less than the annual capacity fixed by the Commissioner, the duty liability can be discharged under Section 3A(4). The Tribunal highlighted the importance of the choice of duty payment method, citing the Supreme Court's decisions in Commissioner of Central Excise v. Venus Castings Pvt. Ltd. and Union of India v. Supreme Steels and General Mills, emphasizing the applicability of Section 3A(4) when the actual production is disputed.

Regarding the payment of duty on non-alloy steel ingots, the Tribunal noted the provisions of Rule 96ZO(1) and Section 3A(4) of the Central Excise Act, 1944. Section 3A(4) allows the Commissioner to determine the actual production if claimed by the assessee, adjusting the duty already paid accordingly. The Tribunal clarified that the manufacturer can pay duty based on actual production if it is lower than the production determined under sub-section (2) of Section 3A.

In conclusion, the Tribunal set aside the Commissioner's order and remanded the matter for a fresh determination of the appellants' duty liability based on the observations made. The stay petition was also disposed of in light of the decision.