RAMAN ISPAT PVT. LTD. Vs. CCE, MEERUT-I

JUDGEMENT

(1.) THE issue involved in this appeal filed by M/s. Raman Ispat Pvt. Ltd. is whether duty of excise is payable by them on the basis of actual production under Section 3A(4) of the Central Excise Act or on the basis of Annual Capacity of Production Determined by the Commissioner. Shri R. Santhanam, learned Advocate, submitted that the Appellant under letter dated 7.8.1997 opted to pay duty under Rule 96ZO(3) of the Central Excise Rules 1944; that the Commissioner under Order dated 23.9.1997 fixed provisionally their annual capacity of production as 9,600 MT with effect from 1.9.1997 which was finally fixed under Order dated 30.3.1998; that for the financial year 1998 -1999, the appellant did not file any option under Rule 96ZO(3); that the appellant under their letter dated 15.6.1998 opted to pay duty on actual production as provided under Section 3A(4) of the Central Excise Act since their actual production was much less than the annual capacity of production fixed by the Commissioner; that it has been settled by the Supreme Court that each financial year is a separate year; that a show cause notice dated 13.11.1998 was issued to them demanding extra duty payable by them during the period from 1.4.1998 to 31.10.1998; that subsequently a corrigendum was issued and demand was restricted for a period from 1.5.1998 to 30.10.1998; that the Commissioner under the impugned Order has rejected their request for re -determination of their duty liability on the basis of actual production under Section 3A(4) of the Act, confirmed the demand and imposed equivalent amount of penalty besides demanding interest relying upon the decision of the Supreme Court in the case of Commissioner of Central Excise v. Venus Casting Pvt. Ltd. : 2000 (117) ELT 273 : 2000 (90) ECR 9 (SC) and Union of India v. Supreme Steel and General Mills : 2001 (133) ELT 513 : 2001 (99) ECR 193 (SC). The learned Advocate further, submitted that the present matter pertains to the period May, 1998 to October, 1998 during which year they had only filed declaration dated 15.6.1998 opting to pay duty on actual production under Section 3A(4) of the Act; that the declaration dated 7.8.1997 is not authentic under the law as during August, 1997 Compounded Levy Scheme was not made applicable to the manufacturer of MS Ingots that in any case, the said declaration would be applicable only for the financial year 1997 -1998 and cannot be made basis for charging the duty for the subsequent financial year; that both the decision of the Supreme Court have been wrongly relied upon by the Commissioner that their case is fully covered by the decision in Supreme Steel and General Mills case as during the financial year 1988 -1989 they had opted only once to pay duty on the basis of actual production. He relied upon the decision of the Appellate Tribunal in the case of S.G. Multi Cast Pvt. Ltd. v. Commissioner of Central Excise Jamshedpur : 2002 (50) RLT 581 CEGAT : 2002 (104) ECR 853 (T) wherein it has been held that Appellants can claim redetermination of annual production capacity under Section 3A(4) and (5) when their actual production is less than annual capacity of production since the Appellant had opted for payment of duty in terms of sub -Rule (1) and not sub -Rule (3) of Rule 96ZO. He finally submitted that the Adjudicating authority, while confirming the demand has omitted to take into consideration the duty deposited by the Appellants for the period in question; that the penalty under Rule 96ZO(3) is not imposable on them; that further no reason has been assigned by the Adjudicating authority for imposing equal amount of penalty.