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2006 DIGILAW 2127 (PNJ)

Commissioner, Central Excise v. Vimal Alloys Ltd.

2006-05-15

ADARSH KUMAR GOEL, RAJESH BINDAL

body2006
Judgment 1. Present petition has been filed under Section 35H(1) of the Central Excise Act, 1944 (for short the Act) seeking a direction to the CEGAT (for short the Tribunal) to refer the following question of law, arising out of final order No. A/422/02/NB (S/M) dated 22-3-2002, for opinion of this Court : Whether CEGAT has erred by allowing the abatement claims to the party for the periods from 25-1-98 to 26-1- 98 who has not fulfilled the statutory requirements of Rule 96 ZO (2) of the erstwhile Central Excise Rules, 1944 ? 2. The respondent-assessee is registered under the Act and was engaged in the manufacturing of non-alloy steel ingots/billets which were chargeable to duty under the Act. With insertion of Section 3A in the Act w.e.f. 1-8-1997, the assessee opted for payment of Excise duty on lump-sump basis. The provision of the Act provided that in case furnace remains closed, the assessee can claim abatement of duty subject to the fulfilment to certain conditions. In the present case the assessee made a claim for abatement for the period 25-1-1998 (8.00 hrs) to 3-2-1998 (10.00 hrs) under Section 3A(3) of the Act read with Rule 96ZO(2) of Central Excise Act Rules, 1944. Out of the above period, the adjudicating authority, vide order dated 24-3-2001, disallowed the abatement claim for the period 25-1- 1998 to 26-1-1998 and directed the assessee to pay the amount of duty involved for the aforesaid period along with interest thereon. 3. Aggrieved against the order of adjudicating authority, the assessee preferred an appeal to the Tribunal. Before the Tribunal the stand of the assessee was that at the time of closure of the unit on 25-1-1998 since it was a Sunday and the next day i.e 26-1-1998 was a gazetted holiday being a Republic Day, the assessee intimated the competent authority about the closure of the furnace by way of telegram. Such mode of intimation to the competent authority in case of holidays or Sunday was permissible in terms of Trade Notice 31/99, dated 10-8-1999 issued by the Commissioner of Central Excise Chandigarh-I. These facts have not been dispute. 4. The Tribunal accepted the appeal of the assessee by recording the following findings : 5. Such mode of intimation to the competent authority in case of holidays or Sunday was permissible in terms of Trade Notice 31/99, dated 10-8-1999 issued by the Commissioner of Central Excise Chandigarh-I. These facts have not been dispute. 4. The Tribunal accepted the appeal of the assessee by recording the following findings : 5. On a careful examination of the submissions, I am inclined to hold that the denial of abatement claim for two days i.e 25-1-98 and 26-1-98 by the Commissioner cannot be justified. Since the office of Central Excise remained closed on 25-1-98 (Sunday) and 26-1-98 (Republic Day), it was humanly impossible for the assessee to personally deliver any notice to the Asstt. Commissioner on any of those days. What was possible for them was done by them. They sent a telegram on 25-1-98 itself to the Asstt. Commissioner wherein they clearly indicated that their furnace had been closed from 8 A.M. on 25-1-98 and would remain closed until further intimation. It was also intimated in the telegram that detailed information was being sent. Accordingly, the party delivered a detailed letter of intimation of closure in terms of clause (b) of Rule 96ZO(2) to the Asstt. Commissioner on the next working day (27-1-98). It appears to me that the party has acted in accordance with the spirit of the Trade Notice and therefore the Commissioner ought not to have discounted their conduct to the extent of denying the abatement claim for the above two days. 5. We do not find any illegality or infirmity has been committed by the Tribunal while accepting the appeal of the assessee when undisputedly the assessee had intimated the department by way of telegram about the closure of the furnace and the same was in conformity with the trade notice issued by the petitioner itself. 6. No case is made out for a direction to the Tribunal to refer the question of law for opinion of this Court 7. The petition is accordingly dismissed.