1997 (3) TMI 272 - AT - Central Excise

Summary

Issues:
1. Denial of benefit of Notification 148/82 due to non-filing of declaration.
2. Interpretation of the mandatory nature of declaration under the Notification.
3. Argument regarding the intention behind filing the declaration.
4. Department's contention on strict interpretation of the Notification requirement.
5. Consideration of the benefit extension based on aggregate clearances and duty slabs.

Analysis:

The appeal before the Appellate Tribunal CEGAT, Madras revolves around the denial of the benefit of Notification 148/82 due to the non-filing of a declaration as required by the notification. The issue arises from the condition in the notification stipulating that the benefit is contingent upon the assessee filing a declaration regarding the quantum of clearances. The department reversed the benefit allowed by the AC, citing non-compliance with this mandatory requirement.

The Tribunal considers the mandatory nature of the declaration under the Notification, emphasizing that it is a crucial condition for availing the benefits provided. The Tribunal notes that while filing a declaration may be seen as procedural in some cases, in this instance, it is deemed mandatory for claiming the exemption. The failure to file the declaration as per the notification's specific wording leads to the denial of the benefit, as highlighted in the department's argument.

The appellant argues that they initially estimated their clearances to exceed the prescribed limit, hence refrained from claiming the benefit. However, their actual clearances remained below the limit, prompting them to file a refund claim later. The appellant contends that the declaration was meant to inform authorities of their intended benefit claim, and their compliance with record-keeping and RT 12 returns submission should be considered.

The department stresses the strict interpretation of the Notification requirement, emphasizing that the benefit is contingent upon filing the declaration. As the appellants failed to fulfill this condition, they are deemed ineligible for the benefit under the Notification, as per the department's stance.

The Tribunal evaluates the benefit extension based on aggregate clearances and duty slabs, considering the circumstances of the appellant's newly set-up unit. It acknowledges the challenges in accurately projecting clearances at the beginning of the year and the appellant's subsequent compliance with refund claims based on actual clearances. The Tribunal emphasizes that denying the benefit to an assessee who did not exceed the value limit would be against the intent of supporting SSI manufacturers' competitiveness. Ultimately, the Tribunal rules in favor of the appellants, noting that the absence of declaration did not prejudice the revenue's interest, given the department's awareness of the clearances through RT 12 returns.