2004 (12) TMI 278 - AT - Central Excise

Summary

Issues Involved: Disallowance of abatement claim, confirmation of demand of Central Excise duty, imposition of penalty.

Analysis:

Abatement Claim for the Period 9-10-1999 to 18-10-1999:
The appeals filed by M/s. Shiv Durga Ispat pertain to the disallowance of their abatement claim for the mentioned period. The Appellants manufacture non-alloy steel ingots/billets subject to duty under Section 3A of the Central Excise Act based on Annual Capacity of Production. The dispute arose when the Department disallowed the abatement claim due to a delay in filing closure intimation. The Appellants argued that they closed the unit on 9-10-1999, a Saturday, and filed the intimation on 11-10-1999, the next working day. The Tribunal acknowledged the validity of filing on the next working day, citing a similar case precedent. However, as the unit operated on 9-10-1999 until late hours, abatement for that day was denied. The abatement claim was allowed for the period from 10-10-1999 to 18-10-1999.

Abatement Claim for the Period 30-11-1999 to 10-12-1999:
Another issue involved the abatement claim for this period, which was disallowed due to a delayed closure intimation. The Appellants attributed the delay to the Director's marriage anniversary. The Department relied on a precedent stating that a factory closure of not less than 7 days is eligible for abatement. As the intimation was given on 3-12-1999, the Appellants were eligible for abatement from 3-12-1999 to 10-12-1999. However, abatement for the period from 30-11-1999 to 2-12-1999 was not available, leading to the imposition of a penalty under Rule 96ZO(3)(ii) of the Central Excise Rules, 1944. The penalty was reduced to Rs. 10,000 considering the allowed abatement claim for a substantial period. The matter was remanded to re-compute the duty liability.

Conclusion:
The Tribunal disposed of all three appeals based on the above analysis, highlighting the importance of timely intimation for abatement claims and the consequences of non-compliance with procedural requirements under the Central Excise Rules, 1944.