2004 (5) TMI 134 - AT - Central Excise

Summary

Issues:
- Appeal against Order-in-Original No. 4/Ch. 54/00-C.E., dtd. 27-4-2000 regarding abatement claim for Central Excise Duty on textile fabrics under heading 54.06.
- Rejection of abatement claim by Commissioner based on failure to follow prescribed procedure for sealing and desealing of stenter as per Trade Notice No. 42/99.
- Arguments regarding closure of stenter, acknowledgment of closure by authorities, and reliance on Gujarat High Court decisions.
- Revenue's grounds reiterated by ld. SDR.
- Consideration of submissions by both sides regarding the prescribed procedure and its application.

Analysis:
The case involved an appeal by a textile manufacturer against the rejection of their abatement claim for Central Excise Duty by the Commissioner. The appellants argued that they followed the prescribed closure procedure for their stenter, which was acknowledged by authorities, and highlighted the inconvenience caused by adopting a new procedure outlined in Trade Notice No. 42/99. They emphasized that the stenter remained closed during the relevant period, entitling them to abatement under Rule 96ZQ(7) of the Central Excise Rules. The appellants also cited Gujarat High Court decisions to support their argument that non-compliance with a procedure partly dependent on an outside agency should not result in penalization. Additionally, they pointed out the subsequent simplification of the procedure through Trade Notice No. 83/2000.

On the other hand, the Revenue, represented by ld. SDR, reiterated the grounds mentioned in the Commissioner's order, emphasizing the importance of following the prescribed procedure for sealing and desealing the stenter as per Trade Notice No. 42/99. However, the Tribunal, after careful consideration of both sides' submissions, found that the Range Superintendent had not followed the correct procedure for sealing the stenter, despite the appellants' cooperation. The Tribunal noted that the stenter was sealed on 25-8-1999 and reopened on 6-10-1999, exceeding one week of closure. Therefore, the Commissioner's disallowance of abatement claim on the grounds of procedural non-compliance was deemed unjustified. The Tribunal ruled in favor of the appellants, setting aside the Commissioner's order and directing a reconsideration of the abatement claim, treating the stenter as closed during the relevant period.

In conclusion, the Tribunal allowed the appeal, emphasizing the importance of procedural compliance by the authorities responsible for sealing and desealing machinery like stenters, and highlighting the need for cooperation between the Range staff and assessees to ensure fair treatment in abatement claims under Central Excise rules.