9911796707
TMI Blog1997 (7) TMI 247X X X X Extracts X X X X X X X X Extracts X X X X ..... ,000/- was also imposed on the appellants. 2. Appellants are manufacturers of electric fans. They were issued a show cause notice on 30-8-1984 and a corrigendum on 3-12-1984 alleging that they had cleared 40,094 pieces of stators and rotors falling under T.I. 30 without payment of excise duty. It was alleged that they had misused the facility of proforma credit under Notification No. 9583, dated 1-3-1983 under Rule 56A inasmuch as they had availed proforma credit on electric stampings and laminations but had not paid duty on the final product, namely, rotors and stators. 3. The allegation was denied by the appellants stating that rotors and stators had been consumed in the manufacture of electric fans within the factory and that the fan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clearing fans on payment of duty. Notification No. 95/79 clearly stipulated that the facility of proforma credit of laminations can be availed of if they were used in the manufacture of rotors and stators. Further, proforma credit available (sic) on rotors and motors under Notification No. 66/83 if the same is used in the manufacture of electric fans provided the procedure laid down in the said Rule 56A is adhered to. Since at the time of physical verification of the appellants stock on 13-8-1984, 40,094 numbers of rotors and stators were found short of the recorded balance in RG 1 Register, the said shortage had been accepted by the General Manager of the appellants himself. Though permission for availing proforma credit under Rule 56A h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o. 3(ii) of the table annexed to Notification No. 66/83-C.E., dated 1-3-1983, electric motors, stators, rotors and die cast rotors were exempted from the whole of duty of excise if such electric motors, stators, rotors and die cast rotors were used in the production as component parts in the manufacture of electric fans falling under T.I. 33. Since the final products manufactured by the appellants were not rotors and stators but electric fans, and since rotors and stators used in the production of component parts in the manufacture of electric fans were exempt from the whole of duty of excise under Notification No. 66/83, no further formality was required to be completed with by the appellants for availing the benefit. They also contended t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as clearly not sustainable. 6. Appearing before us Shri J.S. Agarwal, ld. Counsel for the appellants submitted that the Collector had taken a very narrow and technical view of the matter. He contended that there was nothing on record to show that there was any revenue loss involved in the case nor was any allegation of clandestine removal established. The production of rotors and stators had been fully accounted in the production of final product, namely, electric fans. The lapse, if any, was purely of technical nature amounting to a procedural deficiency. Referring to the impugned order, ld. Advocate stated that the Adjudicating Officer himself has observed that in case the appellants intended to get nil rate of assessment for rotors and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Dy. Collector for availing proforma credit in respect of duty paid on electric stampings and laminations under Rule 56A. If they were clearing rotors and stators for captive consumption or otherwise they were, under the law, required to pay duty and clear them under Gate Passes. Once they had opted for the proforma credit procedure on stampings and laminations used in the manufacture of rotors and stators, they could not extend it to clearance of rotors and stators at nil rate of duty to rotors and stators under Notification No. 66/83 or avail of proforma credit facility under Rule 56A for laminations and stampings. Having opted for proforma credit under Rule 56A for stampings and laminations they could not unilaterally and without obtainin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the part of the assessee, proforma credit cannot be denied if the conditions and other requirements for availment of proforma credit have been substantially complied with [1989 (42) E.L.T. 154 in Hira Cement Works v. Collector of C.E.]. There is also no dispute as to discharge of duty liability on clearances of the final products, namely, electric fans. The Collector has found that inasmuch as the appellants have not sought prior permission of the proper officer for availing the benefit of Notification No. 66/83, they have suppressed the said fact, and therefore a contravention of Rule 9(2) has occurred. In the facts and circumstances of the case, we do not feel that this can be considered as a deliberate act of commission with intend to ev ..... X X X X Extracts X X X X X X X X Extracts X X X X
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