2005 (2) TMI 424 - AT - Central Excise

Summary

Issues:
1. Denial of concession under Notification No. 22/82-C.E. to M/s. Chellapandi Match Works.
2. Maintainability of Appeal No. 2426/1998.
3. Challenge to the dropping of demand of differential duty on M/s. Veluchamy and Ramasamy.

Issue 1: The case involved the denial of concession under Notification No. 22/82-C.E. to M/s. Chellapandi Match Works due to the clandestine purchase of Central Excise Stamps by Shri Ramasamy, which were suspected to be sold to Middle Sector Units. The Assistant Collector's Order-in-Original No. 42/93 held that the benefit of the Notification was not deniable to the respondents, but imposed a differential duty on the illegally procured stamps. The Collector (Appeals) set aside the demand of duty but confirmed penalties on Shri Veluchamy and Shri Ramasamy for contravention of Central Excise Rules. The Department challenged this decision in Appeal Nos. E/2356 & 2357/1998, which were dismissed as the Assistant Collector's finding was not challenged and had attained finality.

Issue 2: The maintainability of Appeal No. 2426/1998 was questioned by the respondents, citing a Tribunal decision and lack of binding case law to the contrary. The Tribunal found that the appeal was not sustainable based on a Larger Bench decision and a previous case involving the Revenue's challenge against dropping a demand, where it was held that an appeal was not maintainable when the original order had merged with a subsequent order.

Issue 3: The challenge to the dropping of the demand of differential duty on M/s. Veluchamy and Ramasamy was based on the contention that the Central Excise Stamps were used in matches manufactured without proper accounts. However, the Tribunal found no evidence of the stamps being used in the factory or by any Middle Sector Unit. The lack of sustainable grounds for the demand of duty on the brothers led to the dismissal of appeals 2356 & 2357/98.

In conclusion, the Tribunal upheld the decision to deny the concession under Notification No. 22/82-C.E. to M/s. Chellapandi Match Works, rejected the maintainability of Appeal No. 2426/1998, and dismissed the challenge to the dropping of the demand of differential duty on M/s. Veluchamy and Ramasamy due to insufficient evidence and lack of sustainable grounds for the demand.