1999 (5) TMI 224 - AT - Central Excise

Summary

Issues:
1. Whether an assessee who opted for a concessional rate of duty under Rule 96ZO(3) can also claim the benefit of sub-section 4 of Section 3A.
2. The relevance of a determined capacity of the furnace for the application of sub-section 4 of Section 3A.

Analysis:

Issue 1:
The appeals before the Appellate Tribunal involved a common issue regarding the eligibility of assessees to claim the benefit of sub-section 4 of Section 3A if they had opted for a concessional rate of duty under Rule 96ZO(3). The Commissioner had previously held that choosing assessment under Rule 96ZO(3) precluded the assessees from claiming the benefit of sub-section 4 of Section 3A. The appellants argued that they should be allowed to apply for the benefit of sub-section 4 of Section 3A if their production was less, citing a previous Tribunal decision. The Tribunal, after considering the arguments, held that the appellants were entitled to the benefit of sub-section 4 of Section 3A. The appeals were remanded to the Commissioner for re-examination under the provisions of sub-section 4 of Section 3A, with the appellants required to provide information for determining actual production for re-determining duty liability.

Issue 2:
The Respondents contended that a determined capacity of the furnace was crucial for the application of sub-section 4 of Section 3A, referencing Rule 96ZO(1) as relevant. They argued that without a determined capacity, assessing actual production for duty liability determination was not feasible. They highlighted that the Commissioner did not consider the option available to the assessee for determining capacity and actual production in the case of M/s. Raman Ispat. The Respondents emphasized that Rule 96ZO(3) was not the appropriate rule for determining production capacity for duty liability redetermination under sub-section 4 of Section 3A. However, the Tribunal, following a previous decision and considering the arguments presented, held that the appellants were indeed entitled to the benefit of sub-section 4 of Section 3A. The appeals were remanded for further examination under the provisions of sub-section 4 of Section 3A, with the duty pre-deposit waived.

In conclusion, the Appellate Tribunal ruled in favor of the appellants, allowing them to claim the benefit of sub-section 4 of Section 3A despite opting for a concessional rate of duty under Rule 96ZO(3). The Tribunal emphasized the importance of determining the furnace capacity for the application of sub-section 4 of Section 3A and remanded the appeals for further examination in light of this provision.