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TMI Blog2010 (1) TMI 331X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal is dismissed. - 31 of 2005 - - - Dated:- 20-1-2010 - Ashutosh Mohunta and Mehinder Singh Sullar, JJ. Shri Kamal Sehgal, Sr. Standing Counsel, for the Appellant. Shri M.P. Devnath, Advocate, for the Respondent. [Order per : Ashutosh Mohunta, J.]. - The Revenue has filed the present appeal under Section 35G of the Central Excise Act, 1944 (for brevity "Act") before this Hon'ble Court challenging the Final Order dated 8-6-2004 of the Customs Excise and Service Tax Appellate Tribunal (for short "CESTAT") on the ground that the following questions of law arise out of the Final Order dated 8-6-2004 passed by the CESTAT :- "1. Whether the Hon'ble CESTAT was legally correct in setting aside demand in respect of cars which had been originally cleared for export but later on brought back to the factory of manufacture for being scrapped? 2. Whether the Hon'ble CESTAT was legally correct to set aside demand of duty on 169 cars, which were manufactured and scrapped? 3. Whether the Hon'ble CESTAT was legally correct in remitting the case to the original adjudicating authority for passing fresh orders regarding party's claim under Rule 173L for which the competen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re repairable but which are not meant for sale in market. Category C pertains to vehicles which are repairable by respondents only. Amongst various categories of transit damage vehicles, it is Category C vehicles that are brought back by respondents to their factory and these vehicles can be repaired by respondents only. 6. The respondents submit that number of vehicles to which damages occur is very few as compared to total number of vehicles manufactured and sold by respondents. This is evident from the following table which depicts data of total vehicles repaired as a percentage of total vehicles cleared during the period of dispute :- Period Total vehicles cleared Total vehicles repaired %age of repaired as %age of vehicles cleared 1997-98 354,355 852 0.24% 1998-99 334,571 631 0.19% 1999-2000 407,433 622 0.15% 2000-2001 (upto Feb. 2001) 310,975 282 0.09% Total 14,07,316 2,387 0.17% 7. Excise Department issued various Show Cause Notices to respondents contending that process of repair undertaken by respondents amou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we had disposed of that appeal under Final Order No. 332-333/-02 in Appeal No. 2524/01 [2002 (146) E.L.T. 427 (Tribunal)]. We had specifically held that the appellants are entitled to benefit under Rule 173L and had remanded the case to the lower authorities for reconsideration in the light of provisions of that Rule. It is evident that the Commissioner has passed the present order without considering that claim. In the present case, the duty demand of a huge amount of Rs. 10.5 crores has been raised against the appellants without considering the claim under Rule 173L. The reason given by the Commissioner for such a part disposal of the case on remand is that Rule 173L claim has to be determined by the Assistant Commissioner/Deputy Commissioner. We are not able to agree with this course of action. This is a case where a consolidated disposal was called for and order passed indicating what is the net amount, if any, due from the assessee. Refusal to do so has led to, as we have noted, very unjust duty demand. The Commissioner could have considered the 173L claims also simultaneously since Rules permit a higher officer to perform the functions of a lower authority. 7. With regard t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmit that no substantial question of law arises for the consideration of this Hon'ble Court. All the questions raised by the revenue in the present appeal are questions of facts. It is submitted that the Tribunal is the last fact finding authority and the Tribunal has arrived at a correct conclusion after going through detailed facts involved in the present case. 13. The duty demand in the present case pertains to the damaged vehicles that were brought back by the respondents in their factory for repairs. The respondents repaired the aforesaid damaged vehicles and thereafter, cleared them either for home consumption or for exports. As far as the exports of repaired vehicles are concerned, once the vehicles have been ultimately exported, there cannot be any duty demand. As regards the internally damaged vehicles, it is submitted that the respondents have removed such vehicles once only and that too on payment of full excise duty, thus, there cannot be any duty demand in respect of internally damaged vehicles. As regards, the clearance for home consumption are concerned, the respondents were following the procedure under Rule 173H and thus, were clearing the repaired vehicles with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ower authorities for reconsideration in the light of provisions of that Rule. It is evident that the Commissioner has passed the present order without considering that claim. In the present case, the duty demand of a huge amount of Rs. 10.5 crores has been raised against the appellants without considering the claim under Rule 173L. The reason given by the Commissioner for such a part disposal of the case on remand is that Rule 173L claim has to be determined by the Assistant Commissioner/Deputy Commissioner. We are not able to agree with this course of action. This is a case where a consolidated disposal was called for and order passed indicating what is the net amount, if any, due from the assessee. Refusal to do so has led to, as we have noted, very unjust duty demand. The Commissioner could have considered the 173L claims also simultaneously since Rules permit a higher officer to perform the functions of a lower authority. 16. Hence the Tribunal has only remanded back the matter. Therefore, there is no question of law involved in the present case. 17. The decision of the CESTAT for remitting the case to the original authority for passing a fresh order, taking into account th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts the manufacturer to carry out whatever processes are required to make the goods marketable. In the present case, repair of cars damaged during the process of manufacture came within the scope of the rule. No dispute is raised that the cars were not damaged or that the appellant is using this as a cover for making other cars. In such circumstances, no duty demand should have been raised. 21. The Tribunal has correctly held that the repair of cars damaged during the process of manufacture came within the scope of Rule 49 as Rule 49 makes it clear that duty is chargeable only on the removal of the goods from the factory or approved place of storage. It is submitted that the fact that cars were manufactured is irrelevant since the cars were not removed from the factory of Respondents. It is further submitted that Rule 49(1A) of Central Excise Rules is inapplicable to the present case since the present case is not of non-accountal of finished goods but is a case where the finished goods manufactured by respondents were repaired. It is further submitted that the provisions of Rule 49 as well Rule 9 considering removal within the factory as removal are inapplicable in as much as the ..... 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