TMI Blog2007 (10) TMI 5X X X X Extracts X X X X X X X X Extracts X X X X ..... gh Court in Tax Appeal No. 427 of 2004 whereby and whereunder the appeal preferred by the appellant herein from a judgment and order of the Customs, Excise and Gold Control Appellate Tribunal dated 22nd May, 2003 as well as Miscellaneous order dated 6th February, 2004, was dismissed. 3. The issue involved in this appeal is as to how the deemed annual production in terms of Section 3A of the Central Excise Act, 1944 which was brought into force with effect from 14.05.1987 should be determined. Appellant herein installed an induction furnace, the capacity whereof was 8 M.Ts. It had asked the Gujarat State Electricity Board (Board) for supply of 3000 KVA of electrical energy. The Board agreed to supply only 1900 KVA input of po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 KVA at 11 KV to your unit to Khakhariya, it is informed you that your total power requirement of 3000 KVA cannot be catered at 11 KV as per feasibility received from our field office. Please note that as per recent amendment condition No. 28 power requirement of 2500 KVA and above requirement to be catered at 66 KV or above voltage as per condition of supply. We are accordingly advising our E.E. (Const.) Amreli to send feasibility report.' 5. A certificate dated 4.09.1997 was issued by a Chartered Engineer wherein the following observation was made: 'c. Crucibles are converted to 4500 Kg. capacity due to lack of power supply.' 6. Our attention has also been drawn to a letter dated 7.04.2000 issued by the Cu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad addressed a letter dated 14.5.1997 to the Superintendent of Central Excise, AR-Sihor, intimating that we were carrying out changes in the capacity of our crucible through M/s Furcon Consultancy Services. We have given detailed reasons necessitating such modification. A copy of the said letter dated 14.5.1997, duly received in the office of the said Superintendent, is enclosed for your perusal. After completion of the changes, we again informed the said Superintendent vide our letter dated 16.5.1997, a receipted copy of which is also enclosed for perusal. Even though at that time the compounded levy was not in force, still we kept the Department informed of the changes carried out by us. It is, therefore, not correct to allege that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... production thereof shall be calculated on proportionate basis of the annual capacity of production." 10. The show cause notice dated 19.06.2000 was issued to the appellant by the respondent on the premise that the capacity of the induction furnace is in excess of 4.5 MTs. The question as to whether in effect and substance the appellant had reduced the capacity of the said induction furnace or not is essentially a question of fact. The Tribunal has passed a very detailed order. It took into consideration all the contentions raised by the appellant herein. It is evident that on representation having been made by the appellant that the capacity of the furnace stood reduced, a Deputy Commissioner was deputed by the Department for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... viz., the conduct of the parties, had also been taken into consideration. 11. The Tribunal in its order dated 22.05.2003 held: "4. The learned Advocate, further, contended that the Commissioner seems to have laboured under a misconception of the scope of ACD Rules as he had observed that change in the working capacity did not lead to change in the installed capacity of the furnace; that the ACD Rules do not talk of 'installed capacity' as the Rules require capacity of the furnace installed in the factory to be determined; that the Rules even provide for increase and reduction of the capacity of the furnace even where a particular capacity has already been determined; that, therefore, where any change is effected before or after ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e before (illegible) commencement of the scheme, is required to be given due weightage (illegible) consideration; that the last sentence of Rule 4 of ACD Rules makes (illegible) obligatory on the part of Commissioner to determine the date from which the change in the installed capacity has taken place.' 12. In its judgment, the Tribunal has noticed: "These evidences, according to Revenue are (i) measurement of Crucible volume of the furnace (specific gravity x volume) which works out to be 7.97 MTs (ii) the weight of MS Ingots including runners and riser produced in a single heat during spot visit was 5.86 MTs (iii) Increase in power consumption and (iv) scrutiny of daily production. We find substantial force in the finding of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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