9911796707
TMI Blog2017 (3) TMI 1206X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee/appellants to recover central excise duty based on value of clearances during March to August, 2013 on the ground that they have failed to comply with the provisions and conditions of the notification No. 17/2007-CE during the said period. Held that: - the assessee/appellant applied for permission to follow the special procedure in terms of the above notification. The same was granted by the jurisdictional officer of Central Excise. Nowhere in the proceedings before the Original Authority it is recorded that the assessee/appellant have opted out of the special scheme. Neither it is recorded that any of the deliberate action on the part of the assessee/appellant will indicate that they are not continuing in the said scheme. The central point of dispute is that due to forced closure of the unit by the State authorities, the assessee/ appellant could not manufacture or operate their machinery during March and April 2013. Such forced closure cannot be termed as a failure on the part of the assessee/appellant to avail the special procedure. The permission granted to the assessee/ appellant to avail the special procedure and all other circumstances which make them eligible for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es installed at their factories and informed the same to the central excise department. The ban on the factories was lifted by the Pollution Control Board in April, 2013. The assessee/appellants reinstalled the dismantled cold rolling machines and commenced operations with effect from 01/05/2013. Due intimation was filed with the jurisdictional central excise officers. From May 2013 onwards central excise duty was discharged in terms of the scheme. Proceedings were initiated against the assessee/appellants to recover central excise duty based on value of clearances during March to August, 2013 on the ground that they have failed to comply with the provisions and conditions of the notification No. 17/2007-CE during the said period. The demands were adjudicated and the original authority confirmed the liability of duty as proposed in the notices. No penalty was imposed. Revenue filed appeals against such nonimposition of penalties. 4. The learned Counsels for the appellants contested the findings in the impugned orders mainly on the following grounds:- (a) Notification 17/2007-CE is a comprehensive exemption notification which contained the procedure in detail. The notification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , is well within his powers to examine the request of the appellant and to take a decision regarding applicability of the procedure in the notification to the facts and circumstances of the present case. His failure to record due reasons in this regard will make the order legally unsustainable. 5. The learned AR reiterated the findings in the impugned orders. It is further submitted that the appellant did not pay any central excise duty in terms of Notification 17/2007-CE for the months March and April 2013. As such, they are not covered by the special procedure set out therein. This bars the appellants from availing the rate of duty as per the special procedure for further period upto August 2013 in terms of clear provision in para 2 (3) of the said notification. In support of the appeals filed by the Revenue against the impugned orders, the learned AR submitted that the Original Authority failed in following the correct legal provision while deciding on the penalty. The failure of the appellants to follow the special procedure and nonpayment of duty as per the actual clearance of excisable goods, are violations which attract penalty under Rule 25 of Central Excise Rules, 2002. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee/appellants to avail the special procedure as stated in the said notification. Since such failure will attract consequences of ineligibility for payment of fixed central excise duty based on number of cold rolling machines, the same is not available to the assessee/appellant for six months. Accordingly, duty was confirmed in terms of actual clearance of the excisable goods based on value determined by the Adjudicating Authority. 7. It is very relevant to note that the assessee/appellant applied for permission to follow the special procedure in terms of the above notification. The same was granted by the jurisdictional officer of Central Excise. Nowhere in the proceedings before the Original Authority it is recorded that the assessee/appellant have opted out of the special scheme. Neither it is recorded that any of the deliberate action on the part of the assessee/appellant will indicate that they are not continuing in the said scheme. The central point of dispute is that due to forced closure of the unit by the State authorities, the assessee/ appellant could not manufacture or operate their machinery during March and April 2013. Such forced closure cannot be termed as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evy scheme under Rule 96ZO and not dealing with the provision of Notification 17/2007-CE. It is apparent that the Original Authority followed dual approach in the same order without any justification. 9. We note that while the Original Authority emphasized on the provisions of para 2 (3) of the notifications, he simply brushed aside the request of the assessee/appellant to consider the circumstances of their closure and to use the powers available to the Jurisdictional JC/ADC in terms of the said notification to condone any failure and to apply the provision of said notification to determine the duty liability of the assessee/appellant. We note that the Original Authority should have examine the request of the assessee/appellant to invoke the provision of para 7 of the said notification and should have given his finding. In case he is not inclined to allow the special procedure to the assessee/appellant, reasons for the same should have been given. No such finding has been recorded by the Original Authority. 10. The issue can be looked into in another angle also. The show cause notices issued to the assessee/appellants are to demand differential duty for the period March to A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he special procedure but ceased the work due to disconnection of power supply and sealing of DG set by the electricity department which was beyond control of the assessee. As such considering the facts and circumstances of the case he found that penalty under Rule 25 of Central Excise Rules, 2002 is not imposable. In such factual finding, we note that non-exercising power under para 7 is not legally sustainable. No reason or finding is recorded in this regard except that the assessee/appellant did not apply to the Jurisdictional AC/DC in terms of the said para. As already noted the Original Authority, being Commissioner of Central Excise, is competent to decide the issue as per the powers granted under para 7, even during the course of adjudication. We note as per the facts recorded above, there is no case for denying the provisions of special scheme to the assessee/appellant. 12. In view of the above discussion and analysis, we find that the impugned orders confirming the differential duty are not legally sustainable. Accordingly, we allow these appeals filed by assessee/appellant by setting aside the impugned orders. The appeals filed by the Revenue for imposition of penalty a ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
