1993 (9) TMI 224 - AT - Central Excise

Summary

Issues:
1. Interpretation of provisions of Central Excises and Salt Act, 1944 regarding destruction of excisable goods.
2. Application of Rule 196B and Rule 195 of the Central Excise Rules in the context of destruction of damaged goods.
3. Formulation of a question of law for reference to the High Court.

Analysis:

1. The judgment involves the interpretation of provisions of the Central Excises and Salt Act, 1944 concerning the destruction of excisable goods. The Collector of Central Excise, Bombay II, sought reference to the High Court based on an issue of law arising from an order confirming the rejection of permission for destruction of damaged goods received under Rule 192 of the Central Excise Rules. Subsequently, permission was granted on payment of duty, leading to a claim for refund, which was initially refused but later sanctioned by the Collector (Appeals).

2. The application of Rule 196B and Rule 195 of the Central Excise Rules was central to the decision. The Tribunal held that goods received under Chapter X procedure could be destroyed without payment of duty under Rule 196B. If goods were damaged during further processes, Rule 195 could apply. The Tribunal allowed the appeal by the Respondents, directing the Department to grant permission for destruction without payment of duty.

3. The issue of formulating a question of law for reference to the High Court was also addressed. The Respondents filed an application seeking reference, formulating a question regarding the applicability of Rule 195 to waste goods post-manufacturing. A preliminary objection was raised regarding the timing of the addendum filing the question. However, the Tribunal held that the addendum clarified the original application and was not a fresh filing, thus rejecting the objection.

4. Ultimately, the Tribunal rejected the prayer for reference to the High Court. It was noted that similar destruction had been refused previously but later deemed non-chargeable. The Tribunal emphasized the interpretation of "on receipt" under Rule 196B and the applicability of Rule 195 to damaged or defective goods. The decision highlighted that denial of permission and demand of duty were not justified based on the clear provisions of Rules 195 and 196B, leading to the rejection of the prayer for reference.

This detailed analysis of the judgment showcases the intricate legal interpretation and application of rules in the context of excisable goods destruction, culminating in the rejection of the reference to the High Court.