1999 (2) TMI 78 - HC - Central Excise

Summary

Issues involved:
1. Determination of annual capacity under Section 3A of the Central Excise Act, 1944.
2. Validity of excise duty levy based on the capacity determination.
3. Admissibility of written statement by the respondents.
4. Quashing of the impugned notice demanding excise duty.
5. Liability of the petitioner to pay excise duty in accordance with law.

Analysis:
1. The judgment pertains to a group of 11 writ petitions involving the determination of annual capacity under Section 3A of the Central Excise Act, 1944. The Commissioner of Central Excise had determined the petitioner's annual capacity and imposed an excise duty liability. However, the order was challenged as the basis for the levy was set aside by the Tribunal, rendering the demand invalid.

2. The respondents sought to place a written statement on record admitting the Tribunal's order setting aside the Commissioner's capacity determination. The respondents argued for the discharge of the order and potential refund/re-adjustment in case of subsequent relief. However, the Court considered the absence of a fresh order determining the capacity and the non-existence of the basis for the demand, leading to the quashing of the impugned notice.

3. The Court acknowledged the petitioner's success based on the Tribunal's order but emphasized the liability to pay excise duty in accordance with the law. The petitioner had been depositing excise duty monthly as per its liability. The judgment clarified that while the impugned notice was quashed, the respondents could still claim duty as per the final determination of the petitioner's liability in accordance with the law.

4. Ultimately, the Court allowed the petitions, quashed the impugned notice, and directed each party to bear its own costs. The judgment highlighted the importance of determining excise duty liability in compliance with the law, emphasizing the need for a valid basis for any levy imposed on the petitioner.

This detailed analysis of the judgment provides a comprehensive understanding of the issues involved and the Court's decision regarding the determination of excise duty liability based on the capacity determination under the Central Excise Act, 1944.