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TMI Blog2002 (4) TMI 104X X X X Extracts X X X X X X X X Extracts X X X X ..... f duties at compounded rates. When the appeal came before a Division Bench of this Tribunal it was contended that demands were partly or fully time barred as recovery proceedings had not been initiated in time in terms of Section 11A of the Central Excise Act. This contention was raised relying on the Division Bench decision of this Tribunal in Appeal Nos. E/401-405/2001-NB (DB), dated 21-9-2001 in the case of Shri Guru Hargobind Steel Industries. Vide Final Order Nos. A/718-722/2001-NB (DB), dated 27-8-2001 [2001 (136) E.L.T. 1047 (T)]. As the Division Bench which heard the present appeals doubted the correctness of the view taken in the case of Shri Guru Hargobind Steel Industries the matter was referred to a Larger Bench. This Larger Bench has been constituted to consider the reference. The reference itself is reproduced as under :- "Misc. Order No. M/255/2001-NB-D Learned Counsel submits that the view taken by the Commissioner in the impugned order that once the capacity has been determined by the competent authority, duty is already determined, and failure by the party to pay this predetermined duty as stipulated under Rule 96ZP does not require issuance of any notice for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roceedings have been initiated under Section 11, the procedural requirement for issuing notice, determining the amount etc. have not been satisfied at all. The Counsel also submitted that there is no exception in the Central Excise Act or Rules regarding procedure of recovery in respect of compounded levy. In this connection, he referred to Rule 173A and other Central Excise Rules in Chapter VII-A of the Rule which relate to assessees working under Self Removal Procedure and submitted that units working under compounded levy scheme (XI) are not exempt from the provisions under Chapter VII-A. He also submitted that Rule 173-I further made it clear that Section 11A procedure has to be followed for recovery of any short levy. Further, specific reliance was placed by the Counsel on the observations of this Tribunal in Paras 11, 12 and 13 of Final Order Nos. A/718-722/2001-NB (DB). 4.Learned Counsel for the appellants submitted that even under other tax laws, quantification of tax has to be undertaken in terms of the relevant section or rule. In this connection, reference has been made to the decision of the Apex Court in the case of Harshad Shantilal Mehta v. Custodian and Others (S. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the scheme is bound by the terms of that scheme. 6.Learned DR also explained that it is now well settled that Section 11A has no application to recovery under different schemes. In this connection, learned DR referred to the decision of the Apex Court in the case of CCE, Jaipur v. Raghuvar (India) Ltd. - 2000 (118) E.L.T. 311 (S.C.) wherein the Apex Court observed that Section 11A is not an omnibus provision which stipulates limitation for every kind of action to be taken under the Acts or Rules. Learned DR pointed out that the Apex Court has observed with regard to Modvat scheme, that scheme of Modvat being a different scheme altogether, the provisions in Section 11A have no application in respect of time limit or otherwise with regard to administration of that scheme. It is, therefore, his submission that Section 11A has no application to compounded levy scheme or Hot Re-rolling Steel Mills Annual Capacity Determination Rules, 1997. Those, manufacturers covered by that scheme have to function entirely according to the Rules applicable to that scheme. Relying on the Apex Court decision in the case of Raghuvar (India) Ltd. he pointed out that an assessee's liability under a spe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arding time and manner of payment. It also contains provision relating to payment of interest and penalty in the event of delay in payment or non-payment of dues. Thus, this is a comprehensive scheme and general provisions in the Central Excise Act Rules are excluded. 8.The judgment of the Apex Court in Raghuvar (India) Ltd. case throws valuable light on how to construe general provisions in Central Excise Act in the context of specific schemes. The issue for consideration in that case was whether Section 11A of the Act was relevant for determining time bar under Modvat scheme. The Apex Court held that Section 11A of the Central Excise Act is not an omnibus provision which provides any period of limitation for all or any kind of action to be taken under Central Excise Act or Rules. The Court observed as follows in Para 13 of the judgment :- Any law or"13. stipulation prescribing a period of limitation to do or not to do a thing after the expiry of period so stipulated has the consequence of creation and destruction of rights and, therefore, must be specifically enacted and prescribed therefor. It is not for the Courts to import any specific period of limitation by implication ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h benefits cannot be said to be the same as the demand for payment to be made under Section 11A of the Act of any excise duty not levied or paid or has been short-levied or short-paid. They fall into two distinct and different categories altogether with basic as well as substantial differences to distinguish them from each other. As a matter of fact, Rule 57-I envisages disallowance of the credit and consequential adjustment in the credit account or the amount current maintained by the manufacturer and if only any such adjustments are not possible proceed to recover the amount equivalent to the credit illegally availed of. Consequently, the situation postulated to be dealt with under Rule 57-I cannot be said to involve a case of manufacture and removal of excisable goods without subjecting such goods to levy or payment of the various nature and category enumerated in Section 11A of the Act on its own terms will have no application or operation to cases covered under Rule 57-I of the Rules". 9.The importing of elements of one scheme of tax administration to a different scheme of tax administration would be wholly inappropriate as it would disturb the smooth functioning of that uni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unsel for the appellants referred to the Larger Bench decision of this Tribunal in the case of Sawanmal Shibumal Steel Rolling Mills v. CCE, Chandigarh-I, 2001 (127) E.L.T. 46 (T). M/s. Shree Bhagwati Steel Rolling Mills (Appeal No. E/768/2001-NB(DB) have submitted that the capacity determination in their case has not been correctly done inasmuch as the same was done based on parameters of other manufacturers. It is their contention that capacity determination should be with regard to the machinery installed in the premises of manufacturer itself. 13.Appellants claims for relief on the above points is required to be considered. A Larger Bench of the Tribunal has rendered a decision on the scope of Rule 5 in the case of Sawanmal Shibumal Steel Rolling Mills v. CCE, Chandigarh-I, 2001 (127) E.L.T. 46 (T-LB). Similarly, since the amount payable under the compounded levy scheme is depending upon the machinery installed by each re-roller, determination of capacity of production should be based on the parameters of the machinery installed by each manufacturer. The parameters of the machinery installed by other manufacturers would not be of any relevance. Accordingly, it is ordered that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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