1987 (8) TMI 340 - AT - Central Excise

Summary

Issues:
- Appeal against order of Collector (Appeals) Central Excise, Calcutta regarding availing of facility under Rule 56A for vanadium pentaoxide manufacturing.

Detailed Analysis:
The appellants in this case manufactured vanadium pentaoxide using vanadium sludge as a raw material falling under T.I. 68 CET. They requested permission for availing facility under Rule 56A from the Assistant Collector, Central Excise, Gaya, but faced delays and refusals. The appellants' refund claim for excess duty paid on vanadium sludge was rejected as time-barred by the Assistant Collector. The Collector (Appeals) also denied their claim citing non-compliance with Notification 178/77 and 201/79 formalities. However, the Collector acknowledged the appellants' communication with authorities and their repeated requests for permission under Rule 56A.

The Tribunal observed that the appellants diligently presented all manufacturing details to the Central Excise authorities and consistently sought permission for Rule 56A benefits. Despite being eligible for the facility as per the Collector (Appeals), the appellants couldn't avail the credit due to the pending permission. They maintained necessary documentation like the D-3 Form and RG 23 Account but refrained from utilizing the credit in RG 23 Register awaiting the required permission. The Tribunal emphasized that any duty payment made by the appellants shouldn't be considered final due to their ongoing plea for Rule 56A permission. Citing the Hon'ble Bombay High Court's decision in Premier Automobiles Ltd. v. Union of India, the Tribunal concluded that as long as the permission for Rule 56A facility was pending, the assessment couldn't be deemed final.

Consequently, the Tribunal set aside the Collector (Appeals) order and directed the Assistant Collector to reevaluate the case considering the appellants' continuous pursuit of Rule 56A benefits. The Tribunal instructed the Assistant Collector to grant the appellants Rule 56A benefits if there is substantial compliance with Rule 56A conditions and to issue necessary orders accordingly.