CHANDIGARH STEELS Vs. CCE CHANDIGARH

JUDGEMENT

(1.) In this application, the appellants have prayed for complete waiver of pre -deposit of the duty amount of Rs.1,29,032/ - and for stay of recovery there of, pending the appeal.

(2.) Examined the records and heard both sides. The applicants, engaged int he manufacture of non -alloy steel Ingots/Billets under compounded levy scheme under section 3A of the Central Excise Act, closed down their factory on account of adverse market conditions during the period 18.8.98 t 31.8.98. The necessary intimations of closure and closure and subsequent restart were given to the jurisdictional Assistant Commissioner in terms of the provisions of Rule 96ZO (2). The applicants, soon after restart of their factory , applied of abatement of duty for the above period of closure. Thereafter, by show -cause notice, the Commissioner asked the party to show cause why the abatement claim should not be rejected on the ground that the intimation of closure given to the Assistant Commissioner in teams of Rule 96ZO (2) (a) was delayed by one day and on the further ground that the declaration of continuous closure as required under Rule 96ZO (2) (e) was not filed. The applicants contested the allegations. In adjudication of the dispute, the Commissioner rejected the abatement claim on the second ground aforesaid and further redirected the party to pay the amount of Rs.1,29,032/ - (for which abatement was claimed). Hence the present appeal and the stay application

(3.) Ld. Advocate, Sh. Ajay Jain submits that the applicants have a strong prima facie case on the basis that the Commissioner, by the impugned order, directed them to pay toe duty without there being any demand for such duty in the show -cause notice. He submits that the demand as confirmed by the Commissioner is beyond the scope of the show -cause notice. It is his further contention that the requirement of Rule 96ZO (2) (e) for declaring continuous closure was virtually met by the applicants by way of their letter dated 31.8.98. Ld.Advocate, therefore, prays for complete waiver of pre -deposit and stay of recovery. Ld. JDR.Sh. S.C. Pushkarna submits that the demand as confirmed in the impugned order is not a demand under Section 11A of the Central Excise Act, but one under the proviso to 96zo (3) of the Central Excise Rules. The direction for payment of duty is only consequential to rejection of the abatement claim. Ld. JDR further submits that, for the purpose of getting the benefit of abatement, the claimant should fulfil all the mandatory requirements of Rule 96zo (2). But the applicants did not satisfy the requirement of clause (e) of the above rule. In their connection,ld. JDR has relied on the decision of the Tribunal's Larger Bench in the case of Avis Electronics. He, therefore, strongly opposes the applicant's plea of strong prima facie case.