WARYAM STEEL CASTINGS LTD. Vs. CCE

JUDGEMENT

(1.) ARGUING the stay petition, Shri R. Santhanam, ld. Advocate submits that the applicants are engaged in the manufacture of iron and steel products. He submits that in terms of amended Section 3(a)(sic) of the Central Excises Act, 1944, it was decided to levy the duty on annual production capacity of the furnace. He submits that there are various provisions for determination of the annual production capacity and that in one of the mandatory requirements it was stipulated that in case the applicant claims that during a particular period the production was less, the adjudicating authority shall provide them an opportunity of hearing in person before deciding the issue. He submits that the applicant had intimated that their factory was closed during a particular period for more than 7 days. He submits that a number of instances were there where closure had taken place for more than 7 days. The adjudicating authority gave them the benefit for only a few periods and not for all the periods of stoppages claimed by them nor were they given an opportunity of being heard in person. He submits that since there was violation of the mandatory requirement, pre -deposit of duty may be waived. Shri Satnam Singh, ld. SDR while opposing the request for waiver submits that the principles of natural justice will not apply in the instant case inasmuch as annual production capacity was to be determined on the basis of facts furnished by the appellants and the show cause notice was issued to the appellants to explain the position. He submits that in reply to the show cause notice, the appellants had made certain submission and some information was supplied which was taken into consideration by the adjudicating authority while fixing the annual production capacity of the factory. He relies upon the judgment of the Hon'ble Delhi High Court in the case of U.P. Co -operative Federation Ltd. ( : 1983 (12) ELT 329). He submits that it was clearly laid down in the judgment that whenever certain written submissions are made and considered the principles of natural justice are not violated.

(2.) WE have heard the rival submissions. We find that in the instant case, the applicants had claimed closure of the factory for more than 7 days on more than one occasion. We find that this thing was clearly stated by the applicants in their reply to the show cause notice. Requirement of law is that whenever the assessee claims a production less than what has been determined by the authorities, the assessee should be given an opportunity of being heard in person. This requirement has been brought out by the applicants. We have perused the reply and we find that the adjudicating authority has considered only a few occasions and not all the occasions where the applicants claimed to have not produced the goods for more than 7 days. Having regard to this fact, we find that it is a fit case for remand after waiving pre -deposit. We, therefore, waive pre -deposit of duty and remand the matter to the adjudicating authority for considering their explanation after affording the applicants an opportunity of being heard in person and pass appropriate orders in accordance with law. (dictated in court).