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TMI Blog2017 (10) TMI 701X X X X Extracts X X X X X X X X Extracts X X X X ..... order dated 9.12.2010 passed by the Customs, Excise and Service Tax Appellate Tribunal, East Regional Bench, Kolkata ( in short "Tribunal") in Excise Appeal No.EDM-159/2005 insofar as it relates to the Financial Year - 1998-99. 2. The facts in short are these. The appellant is a company. It is in the business of manufacturing of iron and steel products falling under Chapter 72 of Central Excise Tariff Act, 1985. The goods manufactured by the appellant are leviable to excise duty. Section 3 of the Central Excise and Salts Act, 1944 provides for levy of the excise duty on goods manufactured. Section 3A was inserted by the Finance Act, 1997. It provided for payment of excise duty on annual capacity production. And sub-section 2 of Section 3A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opted out from the scheme of paying excise duty on lump sum basis and sought to pay excise duty on actual production basis. The appellant also reiterated its request to pay excise duty on actual production basis by making another application dated 4.2.1999. But the Commissioner, Excise vide order dated 12.4.1999 rejected the application on the ground that appellant was not covered by the Supreme Court's order dated 21.4.1998. 6. Moreover, since the Central Excise authorities were against the payment of excise duty on actual production basis and were threatening to take penal measures, the appellant filed WP(C) No.2020/1999, in which, a Single Judge Bench of this Court, vide order dated 3.5.1999, directed the authorities not to take any co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner, Excise. 8. The Tribunal, vide order dated 9.12.2010, partially allowed the appellant's appeal holding that option exercised by it vide application dated 1.10.1998 will be available for the year 1999-2000 and not for the year 1998-99. While doing so, the Tribunal relied upon the decision of the Supreme Court in Union of India vs. Supreme Steels and General Mills (2001) 9 SCC 645, wherein it is held that manufacturer cannot opt twice in the same financial year because the assessment has to be made for the whole year and not in piece meal manner. It is in this background, the appellant has filed the present appeal. 9. On 10.5.2012, the appeal was admitted on the following question of law:- "The question involved is whether the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 filed by the Appellant during the earlier Financial Year 1997-1998 could be taken as a declaration for the subsequent Financial Year 1998-1999, even though the Appellant opted out on 01.10.1998 i.e. during the Financial Year 1998-1999? (ii) Is there any time limit in a given Financial Year to opt out of the scheme?" 11. The learned counsel for the respondents, in the light of subsequent event, fairly agreed with the substitution of questions of law as prayed for by the appellant. We, therefore, allow the application and proceed to decide the matter on the substituted questions of law. 12. The learned Senior Counsel for the appellant has argued that letter of option dated 10.9.1997 to pay central excise duty on lump sum basis was for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 97 to 31st day of March, 1998 was duly paid. The appellant then vide application dated 1.10.1998 opted out from the scheme of paying excise duty on lump sum basis and sought to pay excise duty on actual production basis. This the appellant did because of various factors, one of them being due to paucity of power supply between 4 pm to 10 pm for industries, there was loss of production in the industry. The Supreme Court also, as mentioned above, vide order dated 21.4.1998 passed in WP(C) No.133/98, had observed that it would be open to the manufacturer to submit application for payment of excise duty on the basis of actual production and the same shall be considered by the competent authority. 14. It is to be noted that the actual productio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar 1998-99 after determining the actual production of that year and the appellant shall pay the calculated amount of duty without any further delay. 15. As regards interest and penalty, the Supreme Court in Shree Bhagwati Steel Rolling Mills -vs- Commissioner of Central Excise (2016) 3 SCC 643, has clearly held that levying of interest under Rule 96 ZO and Rule 96 ZP of the Rules is not permissible because Section 3A of the Central Excise and Salts Act, 1944, which provides for a separate scheme for availing facilities under a compound levy scheme does not itself provide for levying of interest. In the same case, the Supreme Court has also struck down Rule 96 ZO and Rule 96 ZP in so far as they impose a mandatory penalty equivalent to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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