TMI Blog2017 (6) TMI 674X X X X Extracts X X X X X X X X Extracts X X X X ..... which was totally non-functional and closed to levy excise duty on production that never came into existence - the denial of re-fixation of ACP w.e.f. 15.08.1998 is unreasonable and unsustainable, for which reason that part of the order is set aside. Pro-rata fixation of duty liability - Held that: - the second furnace [1570] had been out of service and non-functional from 06.03.1998 to 15.07.1998, which has also been acknowledged by the Commissioner - the appellants will be eligible to discharge duty liability for that period, on pro-rata basis, as per the proviso to Rule 96 ZO (3) of the erstwhile Rules read with Rule 4 of the Induction Rules. With regard to interest and penal liabilities, it is seen that the matter is squarely cove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capacity of production fixed as 25,600 MTs 2. Abatement for closure of the furnace/s had been sought by the appellants on various occasions. Further, in respect of the furnace [1570], it appears that the same had broken down on 6.3.1998 due to a major fire, the fact of which had been intimated by the appellants to the department on the same day. Subsequent letters conveying the status of repairs of the said furnace has also been communicated to the Department vide letters dated 5.3.1998, 16.3.1998, 30.3.1998, 14.7.1998 and 18.07.1998. In the letter dated 18.07.1998, the appellant informed the Department that as they are not satisfied with the running condition of the furnace 1570 and also due to then recessionary conditions they are pla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capacity of production and total installed capacity, the adjudicating authority has demanded differential duty of ₹ 35,66,107/- along with interest liability thereof. Equal penalty under Rule 96 ZO (3) of the Central Excise Rules, 1944 has also been imposed. The appellants have once again preferred an appeal before this Tribunal in the present appeal No. E/724/2005. Tribunal vide stay order dated 02.11.2006 directed the appellants to pre-deposit ₹ 25,00,000/- under Section 35 Central Excise Act, 1944, on non-compliance of which the appeal was dismissed vide order No.22/2007 dated 08.01.2007. This dismissal was challenged by the appellants before the Hon ble High Court of Madras, who vide their order dated 13.02.2017, set aside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision in this appeal are concerning the eligibility of pro-rata duty liability and the effective date for revised ACP. The adjudicating authority in the impugned order has re-determined the ACP only from 12.09.1998 and has denied pro-rata duty liability benefit for earlier period. 8.2 It is seen that the said authority himself the impugned order has taken cognizance of the appellants various letters about the breakdown of furnace [1570] on 06.03.1998, the fact of continued non-functioning of the furnace. They have also intimated, vide letter dated 18.07.1998, their intention to completely close down the furnace [1570] w.e.f. 15.08.1998. By another letter dated 17.08.1998, they confirmed the said closure. However, the reason for not co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In respect of the prayer for pro-rata fixation of duty liability, we find from various communications and intimations that it is a fact that the second furnace [1570] had been out of service and non-functional from 06.03.1998 to 15.07.1998, which has also been acknowledged by the Commissioner in para 11.3.4 of the impugned order. In the circumstances, we are of the considered opinion that the appellants will be eligible to discharge duty liability for that period, on pro-rata basis, as per the proviso to Rule 96 ZO (3) of the erstwhile Rules read with Rule 4 of the Induction Rules. So ordered. Competent authority shall refix the duty liability on pro-rata basis for the said period and communicate the same to the appellant. 8.5 Since the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ishing details about the annual capacity of production and duty payable on such capacity of production. It has to be taken into consideration that the compounded levy scheme for collection of duty based on annual capacity of production under Section 3 of the Act and the 1997 Rules is a separate scheme from the normal scheme for collection of Central excise duty on goods manufactured in the country. Under the same, Rule 96-ZP of the Central Excise Rules stipulate the method of payment and Rule 96-ZP contains detailed provision regarding time and manner of payment and it also contains provisions relating to payment of interest and penalty in event of delay in payment or non-payment of dues. Thus, this is a comprehensive scheme in itself and g ..... X X X X Extracts X X X X X X X X Extracts X X X X
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