9911796707
TMI Blog1999 (9) TMI 316X X X X Extracts X X X X X X X X Extracts X X X X ..... Stay Order No. 966/99, dated 18-6-1999 [1999 (114) E.L.T. 152 (Tribunal)] by which waiver of pre-deposit and stay had been granted. The same is extracted below : 4. The learned Advocate submits that as provided under Section 3A, the annual capacity of the induction furnace is to be determined as per the above noted rules prescribed by the above noted notification. Taking us to the rules, he submits that there is no dispute that the rules will apply to their induction furnace. He further submits that the learned Commissioner had called for an authenticated copy of the manufacturer s invoice upon which they had purchased the said furnace in 1985 (on 31-7-1985). The same was supplied and based on further enquiries made by the Commissionerate including technical consultation with the Chartered Engineer (vide his certificate dated 27-8-1997) taking all the relevant factors into consideration, the learned Commissioner vide order dated 23-9-1997 had fixed the capacity at 2.50 Mts. 5. The learned Advocate submits that some time later, the Commissionerate Officers visited their unit along with the same Chartered Engineer, the actual production on 28-5-1998 was measured and it was reve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hey had suppressed the said capacity when it was fixed initially. 7. The learned Advocate further takes us to the said rules and submits that the capacity is to be fixed as per Rule 3(1) thereof which makes it mandatory on the Commissioner to call for the said invoices and to base his decision on the position of this invoice. The learned Advocate submits that this step was fully carried out to the entire satisfaction of the Commissioner which resulted in the said capacity fixation of the order dated 23-9-1997. He submits that only if such an invoice is not available, then can the Commissionerate take resort to sub-rule (2) thereof for fixation of the capacity in terms of either comparable furnaces or otherwise by best judgment. Since at the initial stage, such an invoice was made available, it was considered and even after taking advice of the Chartered Engineer, the said invoice was found reliable and accordingly the capacity was fixed initially, therefore, the Commissionerate is now totally prevented from taking resort to sub-rule (2) ibid at any stage. The learned Advocate further submits that Rule 4 is the only rule, which provides for a review of the said capacity. This rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capacity. In this connection, we note that the Explanation (1) of Section 3A of the Act clearly takes this position as follows :- (1) Notwithstanding anything contained in Section 3, where the Central Govt. having regard to the nature of the process of manufacture or production of excisable goods of any specified description, the extent of evasion of duty in regard to such goods or such other factors as may be relevant, is of the opinion that it is necessary to safeguard the interest of revenue, specify, by notification in the Official Gazette, such goods as notified goods and there shall be levied and collected duty of excise on such goods in accordance with the provisions of this Section. A plain reading thereof shows that the duty determined on the basis of the annual production capacity determined in the prescribed rules shall be deemed to be duty of excise leviable for the purposes of Section 3 etc. (b) We also find that a perusal of the Annual Capacity Determination Rules noted above show that the said capacity has to be determined under Rule 3. Sub-rule (1) of Rule 3 makes it mandatory on the Commissioner by using the words shall call for an authenticated copy of ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... great merit. (d) We also find merit in the submission of the learned Advocate that no where does the rule enjoin them to declare annual capacity, the only burden that sub-rule (1) of Rule 3 supposes on them is on being called upon to do so by the Commissioner to supply an authenticated copy of invoice, we note it is not disputed that they have fulfilled this duty. Supply of a such document cannot in our considered prima facie opinion tantamount to a declaration of the capacity of the production. What is supplied is merely evidence on facts. Evidence on facts supplied is distinct from a declaration under law. 10. In view of the aforesaid analysis and consideration we are of the prima facie view that the applicant has therefor made out a strong case on merits. In view of this, we order full waiver of pre-deposit of duty, interest and penalties, as prayed for in the said stay application and we also grant stay from recovery thereof, during the pendency of the appeal. 3. The learned Counsel further submits that the Revenue has not issued any notice proposing to revise the capacity fixed earlier under Section 3A of the Act either on the ground that the evidence shown in the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prays that the impugned order needs to be set aside. 4. The learned DR submits a detailed re-action in the form of comments which he has obtained from the Commissionarate, copy of which has been filed in the Court on 27-9-1999. The position advocated by the Revenue in this copy is summarised as follows. It is contended by the Revenue in these comments that when invoice was submitted and enquiries made leading to the original order fixing the said capacity under Section 3A the learned Commissioner did not harbour any doubt pertaining to the said invoice. However, intelligence gathered showed that the furnace was producing a much larger quantity of the final product than the deemed quantity fixed in the said order. To verify this the Revenue conducted two trial productions under the supervision of technically qualified Chartered Engineer and the results were recorded in a mahazar. It is the contention of the Revenue that when it comes to their notice that the actual production is more by over 40% than the deemed production capacity fixed, then the Revenue cannot sit idle, as obviously the duty being paid is far less than what was actually payable. Therefore, the learned DR submits ..... X X X X Extracts X X X X X X X X Extracts X X X X
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