1991 (11) TMI 156 - AT - Central Excise

Summary

Issues:
1. Interpretation of Rule 57F(4) of the Central Excise Rules regarding clearance of scrap generated under Modvat Scheme.
2. Validity of demanding duty on Aluminium scrap cleared without payment between specific periods.
3. Impact of a trade notice issued by the Hyderabad Collectorate on the demand for duty.
4. Consideration of the timing of the trade notice in relation to the period of duty demand.
5. Applicability of the trade notice as an order by the Central Government for clearance without duty payment.
6. Judicial review of the decision of the Collector of Central Excise (Appeals), Madras.

Analysis:
The appeal before the Appellate Tribunal CEGAT, Madras involved a dispute regarding the clearance of Aluminium scrap without payment of duty under Rule 57F(4) of the Central Excise Rules. The Revenue contended that the scrap should either be cleared on payment of duty or destroyed, as per the rule. The Collector (Appeals) had allowed the clearance based on a trade notice issued by the Hyderabad Collectorate. However, the Tribunal noted that at the relevant time, no Central Government order existed for such clearance without duty payment, and the trade notice was issued later. The Tribunal cited a previous case to support that the trade notice could be considered an order by the Central Government but noted that it was issued after the period in question. Consequently, the Tribunal held that duty was correctly demanded, overturning the Collector's decision.

In a separate judgment by another Member of the Tribunal, it was emphasized that the relief sought by the appellant was limited to a specific amount of duty, which was duly debited. The Member highlighted that the lower appellate authority had granted a larger relief not requested by the appellant, which was improper in quasi-judicial proceedings. Additionally, the Member clarified that the trade notice could not retroactively apply to the period in question, rendering it ineffective for the appellant's case. Therefore, the judgment was deemed unsustainable in law, and the appeal was allowed, ordering in favor of the Revenue.