ASHUTOSH METAL INDUSTRIES Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) With consent of counsel for the parties, the following question of law is urged in this case: -

(2.) The appellant was issued a show cause notice seeking to impose Central Excise duty in terms of Section-3A of the Central Excise Act, 1944. The appellant denied any liability; during the course of proceedings, statements of witnesses including its employees were recorded. By order dated 30.3.2009, the show cause notice was confirmed and among others, the demand for Rs. 8,30,53,761/- (Rs. Eight crore thirty lakh fifty three thousand seven hundred sixty one) of duty and penalty of the equal amount was imposed. The appellant carried the matter in appeal to the CESTAT (Tribunal for short) which by order dated 08.04.2011 directed payment of Rs. 6 Crores as pre-deposit amount. The appellant moved an application for rectification urging inter alia its extreme financial hardship and also contending that the impugned Order in Original itself reveal that production capacity was 5 MT per day and by no stretch of imagination, the duty is to be exceeded the sum of Rs. 73 Lakhs. The Tribunal, however, rejected the application for rectification without any reasons.

(3.) Learned counsel relied upon paragraph-41 of the Order in Original and submitted that having noticed and taken into consideration the fact that the production capacity of the appellant was 75 MT per month and the total production which could have been achieved for the period in question was 600 MT, the Commissioner, could not have directed payment of an astronomical amount of Rs. 8,30,53,761/- (Rs. Eight crore thirty lakh fifty three thousand seven hundred sixty one) with like penalty. It was urged that the Order in Original completely overlooked this fact which also escaped the attention of the Tribunal. Counsel further emphasized that in the application for rectification, other facts too had been eluded to and were even urged during the hearing, with reference to financial hardship which were not taken into consideration.