2013 (3) TMI 212 - AT - Central Excise

Non payment of excise duty on waste and scrap generated at the job workers end - two show cause notice issued dated 18.1.2008 and 2.5.2008 - Jurisdictional Asst. Commissioner dropped the proceedings initiated under the aforesaid show-cause notices - Against the said order the department filed appeal on the ground that the appellant had given an undertaking that they would discharge the duty liability on waste and scrap generated at the job workers premises in case they failed to bring back such waste and scrap - lower appellate authority accepted the plea of the department and held appellants liable to pay excise duty - During the pendency of the appeal the adjudicating authority reassessed the show-cause notices and confirmed the demand against the appellant - Held that - Commissioner (Appeals) who vide order passed appeal of the revenue and set aside the order of the original adjudicating authority there was no direction given by the Commissioner (Appeals) for re-adjudication of the show cause notices. Despite that the adjudicating authority in over-enthusiasm re-adjudicated the show-cause notices and passed the order dated 29.1.2010 confirming the demand against the appellant despite the facts that it was brought to the notice of the adjudicating authority that the appeal has been filed before this Tribunal against the order of the Commissioner (Appeals) dated 21.8.2009. The adjudication order was further challenged before the Commissioner (Appeals) and before the Commissioner (Appeals), the appellant submitted that the operation of the order dated 21.8.2009 has been stayed by this Tribunal vide order dated 29.3.2010, despite that the Commissioner (Appeals) disposed of the appeal instead of keeping the appeal pending. The action of both authorities, i.e. adjudicating authority and Commissioner (Appeals) are not appreciable. Moreover as appeal against the order of Commissioner (Appeals) is pending before this Tribunal, the adjudicating authority dared to pass the impugned order. This shows that the officers of the department have no respect for the orders passed by this Tribunal and they are following their own law which results in unnecessary litigation before this Tribunal. Thus neither re-adjudication nor any order was required to be passed by the Commissioner (Appeals) till the final disposal of the appeal by the Tribunal. Therefore, set aside the impugned order and allow the appeal with consequential relief.

Summary

Issues:
Appeal against confirmed demand of duty, interest, and penalty. Re-adjudication of show-cause notices. Failure to pay excise duty on waste and scrap generated at job workers' end. Liability to discharge duty on waste and scrap. Respect for orders passed by the Tribunal.

Analysis:
The appellant, a manufacturer of excisable goods, sent cast articles for job work to various job workers. The appellant failed to pay excise duty on waste and scrap generated at the job workers' end for a specific period. Show-cause notices were issued proposing recovery of duty, interest, and penalty. The Jurisdictional Asst. Commissioner dropped the proceedings based on precedents and circular clarifications. The department appealed, arguing that the appellant was liable to pay duty based on the undertaking given under Rule 4(6) of the CENVAT Credit Rules, 2004. The lower appellate authority upheld the department's plea, leading to the appellant challenging the order before the Tribunal.

During the appeal process, the adjudicating authority re-assessed the show-cause notices and confirmed the demand, which was challenged before the Commissioner (Appeals) and subsequently by the appellant before the Tribunal. The appellant argued that no action should have been taken by the adjudicating authority until the Tribunal's final decision. Despite the Tribunal setting aside the Commissioner (Appeals)'s order, the lower authorities continued with unnecessary litigation, disregarding the stay order issued by the Tribunal. The Tribunal criticized the actions of both authorities for not respecting the Tribunal's orders, leading to avoidable litigation.

The Tribunal found the actions of the lower authorities unacceptable, noting that no re-adjudication or new orders were necessary until the Tribunal's final decision. Consequently, the Tribunal set aside the impugned order and allowed the appeal with consequential relief. The judgment emphasizes the importance of respecting Tribunal orders and avoiding unnecessary litigation through proper adherence to legal procedures and directives.