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TMI Blog2009 (1) TMI 287X X X X Extracts X X X X X X X X Extracts X X X X ..... t has filed fresh declaration referred hereinabove and vide letter dated 25th September, 2000 claimed re-determination on the basis of amendment in the Rule by Notification No. 14 of 2000, dated 1st March, 2000 and the decision by the Tribunal in the case of Chiman Lal Silk Mill (P) v. Commissioner of Central Excise, (2000 (3) TMI 98 - CEGAT, CHENNAI), but these aspects of the matter have not been considered by the Tribunal, which according to us are relevant to adjudicate the issue. Appeal is allowed. The impugned order of the Tribunal dated 3rd June, 2008 is set aside and the matter is remanded back to the Tribunal to decide the appeal afresh in accordance to the law in the light of the observations made above - 335 of 2008 - - - Dated:- 21-1-2009 - Amitava Lala and Rajes Kumar, JJ. [Judgment per : Rajes Kumar, J.]. - By means of present appeal, the appellant is challenging the order of the Customs, Excise and Service Tax Appellate Tribunal, New Delhi dated 3rd June, 2008 by which the appeal filed by the Commissioner of Central Excise, Kanpur has been allowed. 2. The brief facts giving rise to the present appeal are that the appellant was engaged in the processing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s are not aiding the process of heat setting or drying of the fabrics, the excise duty was paid under protest. The said refund claim was rejected by the Deputy Commissioner Central Excise Division-II Kanpur vide order dated 4th October, 2000. It has been mainly rejected on the ground that against the order of the Commissioner fixing the annual production capacity vide order 29th March, 1999, including gallery for stenter has not been challenged by the appellant. The duty was paid as per the order of the Commissioner Central Excise, referred here-in-above, and in the refund claim the order of the Commissioner cannot be challenged. In support of the contention reliance is placed on the decision of the Apex Court in the case of Collector of Central Excise, Kanpur v. Flock (India) Pvt. Ltd., reported in 2000 (120) E.L.T. 285 (S.C.). 6. Being aggrieved by the order, the appellant filed appeal before the Commissioner Central Excise (Appeals). The appeal was allowed vide order dated 31st December, 2003 on the ground that firstly; party had paid duty under protest through TR-6/Challan; secondly the G.O.'s modified the Rules and the Galleries were excluded from the measurement of the cham ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order of the Commissioner fixing annual capacity in the refund proceeding which has become final. 8. Heard learned counsel for the parties. 9. Learned counsel for the appellant submitted that the order of the Commissioner, Central Excise fixing the annual production capacity, including the gallery for stenter was patently incorrect. He submitted that vide Notification No. 14/2000-C.E. (N.T.), dated 1st March, 2000, the Hot Air Independent Rules, 2000 were notified replacing earlier rules introduced vide Notification No. 42/98. Explanations I, II, III and IV appended to the notification are clarificatory in nature by which the galleries were excluded for the measurement of the chamber. He further submitted that the Apex Court in the case of Commissioner of Central Excise, Jaipur-II v. SPBL Ltd. (Supra) has held that galleries were not to be included in the measurement of the stenter and, therefore, the duty collected was without the authority of law and liable to be refunded. 10. Learned counsel for the appellant submitted that vide letter dated 22nd April, 1999, the appellant has intimated to the Assistant Commissioner for depositing the excise duty under protest on stent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that galleries have not been included in the chambers in the case of CCE v. SPVC Limited (Supra) the order of the Commissioner dated 29th March, 1999 stand erroneous and the duty was payable on the annual capacity production excluding galleries. Any duty paid in excess was without the authority of law and cannot be retained by the Revenue. He submitted that in fact, on the protest of the appellant about the determination of the annual capacity excluding the galleries, the Commissioner should have re-determined the capacity having regard to the amended Rules and the decision of the Apex Court referred herein above. At the end he submitted that the order of the Tribunal is vitiated inasmuch as it has not adverted to the findings recorded by the Commissioner while reversing the order. 11. Learned Standing Counsel submitted that the annual production capacity has been determined by the Commissioner, Central Excise vide order dated 29th March, 1999, including the galleries. Such order was appealable but the appellant has not filed any appeal and accepted the said order and paid the duty on the basis of the said order. He submitted that it is not open to the appellant to dispute the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tenter Independent Textile Processors Annual Capacity Determination Rules, 1998. (2) They shall come into force with effect from the 16th day of December, 1998. 2. These rules shall apply to processed textile fabrics falling under heading Nos. 52.07, 52.08, 52.09, 54.06, 54.07, 55.11, 55.12, 55.13, [55.14], or processed textile fabrics of cotton or man-made fibres, falling under heading Nos. 58.01, 58.02, 58.06 (except sub-heading No. 5806.20), 60.01 or 60.02 (except sub-heading No. 6002.10), of the Schedule to Central Excise Tariff Act, 1985 (5 of 1986), for determining the annual capacity of production of an independent processor if such textile fabrics are manufactured or produced with the aid of a hot-air stenter. 3. The annual capacity of production referred to in Rule 2 shall be determined in the following manner, namely:- (1) An independent processor shall declare- (i) the number of hot-air stenters installed in his factory; (ii) the name of the manufacturer of each of the hot-air stenter, its identification No. and the date of its purchase; (iii) the number and size (both the length and width in centimetres) of chambers in each of the hot-air stenters; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of fabrics of average value of upto and including Rs. 30 per square metre, Rs. 11.72 lakhs, and (b) in the case of fabrics of average value of exceeding Rs. 30 per square metre, Rs. 15.63 lakhs. (4) the Commissioner of Central Excise shall, as soon as may be, after determining the annual capacity of production on the basis of the average value of processed textile fabrics and the number of chambers (of a hot-air stenter) of the factory of the independent processor, by an order, intimate the same as also the rate of duty applicable to the independent processor : Provided that the Commissioner may determine the annual capacity of production on provisional basis pending verification of the declaration furnished by the independent processor and pass an order accordingly. Thereafter, the Commissioner may determine, the annual capacity, as soon as may be, and pass an order accordingly. 4. The capacity of production for any part of the year, or any change in the total number of chambers, shall be calculated pro-rata on the basis of annual capacity of production determined in the manner stated in Rule 3. 5. In case an independent processor proposes to make any change ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xtraordinary, vide notification No. 42/98-Central Excise (N.T.), dated the 10th December, 1998, the Central Government, hereby makes the following rules to provide for determination of the annual capacity; of production of certain notified under sub-section (1) of said Section 3A. Determination of annual capacity and average value.- (1) The annual capacity of production of processed textile fabrics specified in Rule 2 in respect of a factory of an independent processor referred to in Rule 2 shall be determined in the following manner, namely :- (i) the number of chambers (of a hot-air stenter), each of which having an rail length of upto 3.005 metre on each side, installed in such factory shall be construed as one chamber and any fraction exceeding such rail length of any such chamber shall be computed on a pro-rata basis; (ii) the production capacity of a chamber in terms of quantity shall be deemed to be 1 lakh sq. mtrs. per chamber per month. (2) The average value of the processed textile fabrics (per square metre) referred to in Rule 2 for such factory shall be arrived at by dividing the total value of such processed fabrics cleared from the factory in the immediately p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of this notification, a float drying machine or any other equipment, except the galleries, of a length 3.05 metres installed in or attached to a stenter for aiding the process of heat setting or drying of the fabrics shall be deemed to be one chamber of a stenter and any fraction of such length shall be computed on a pro-rata basis. Explanation II. - Unless otherwise specified in any rule made under Section 3A of the Central Excise Act, 1944 (1 of 1944), for the purposes of this notification the goods shall be deemed to have been manufactured to produced with the aid of a hot-air stenter, if they are cleared from a factory where a hot-air stenter is installed, irrespective of whether it is in use or not, or is in working condition or not. Explanation III. - For the purposes of this notification,- i. "independent processor" means a manufacturer who is engaged primarily in the processing of fabrics with the aid of power and who also has the facility in his factory (including plant and equipment) for carrying out heat-setting or drying, with the aid of power or steam in a hot-air stenter and who has no proprietary interest in any factory primarily and substantially engaged in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tted any error in relying upon the doctrine of contemporanea expositio to remove ambiguity in understanding the language of the 1998 rules. Hence, in our view, the impugned order passed by the tribunal does not call for any interference." It is also relevant to refer the relevant paragraph of the decision of the Apex Court in the case of Collector of Central Excise, Kanpur v. Flock (India) Pvt. Ltd. (Supra) which reads as follows : "Coming to the question that is raised there is little scope for doubt that in a case where an adjudicating authority has passed an order which is appealable under the statute and the party aggrieved did not choose to exercise the statutory right of filing an appeal, it is not open to the party to question the correctness of the order of the adjudicating authority subsequently by filing a claim for refund on the ground that the adjudicating authority had committed an error in passing his order. If this position is a accepted then the provisions for adjudication in the Act and the Rules, the provision for appeal in the Act and the Rules will lose their relevance and the entire exercise will be rendered redundant. This position in our view, will run co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n has to be construed in the light of the goal and the ideals set out in the Preamble to the Constitution and in Articles 38 and 39 thereof. The concept of economic justice demands that in the case of indirect taxes Central Excise duties and Customs duties, the tax collected without the authority of law shall not be refunded to the petitioner-plaintiff unless he alleges and establishes that he has not passed on the burden of duty to a third party and that he has himself borne the burden of the said duty. (vii) While examining the claims for refund, the financial chaos which would result in the administration of the State by allowing such claims is not an irrelevant consideration. Where the petitioner-plaintiff has suffered no real loss or prejudice, having passed on the burden of tax or duty to another person, it would be unjust to allow or decree his claim since it is bound to prejudicially affect the public exchequer. In case of large claims, it may well result in financial chaos in the administration of the affairs of the State." 16. Section 3A of the Act which was introduced by the Finance Act, 1997 was for a very short period. It was omitted w.e.f. 11th May, 2001 by the Fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed. It also appears that the appellant has filed fresh declaration referred hereinabove and vide letter dated 25th September, 2000 claimed re-determination on the basis of amendment in the Rule by Notification No. 14 of 2000, dated 1st March, 2000 and the decision by the Tribunal in the case of Chiman Lal Silk Mill (P) v. Commissioner of Central Excise, reported in 2000 (120) E.L.T. 766 (Hyderabad), but these aspects of the matter have not been considered by the Tribunal, which according to us are relevant to adjudicate the issue. Perusal of the order of the Tribunal reveals that the Tribunal has not considered the aforesaid aspect referred hereinabove. In this view of the matter, we are of the view that the matter requires reconsideration by the Tribunal. The decision relied upon by the Tribunal in the case of Collector of Central Central Excise, Kanpur v. Flock (India) Pvt. Ltd. (Supra) and further the decision of the Apex Court cited by the learned Standing Counsel in the case of Mafatlal Industries Ltd. v. Union of India (Supra) may be considered and be applied only on a consideration of the aforesaid facts. 18. In the result, appeal is allowed. The impugned order of the T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Rules, 2000. Demands of framing said Rules were raised by various Commissionerates. Therefore, this required determination of question of refund irrespective of preferring or not preferring appeal herein. Later judgment is specifically applicable when the earlier one is generally applicable. Special derogates from the general following the maxim specialia generalibus derogant. As soon as the law is declared by the Supreme Court, it gives an immediate substantive right to the appellant to raise such issue before the appropriate forum for adjudication. The presumption against retrospective operation is not applicable to declaratory statutes. A substantive right as accrued by the appellant is clarificatory in nature. Curative statutes are by their very nature intended to operate upon and affect past transactions and are therefore, fully retrospective. Curative and validating statutes operate on conditions already existing and can have no prospective operation. It is well settled that if a statute is curative or merely declares the previous law, retroactive operation would be more rightly ascribed to it than the legislation which may prejudicially affect past rights and transactions. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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