2005 (3) TMI 316 - AT - Central Excise

Summary

Issues:
1. Re-determination of Annual Capacity of Production (ACP) under Section 3A(4) of the Central Excise Act.
2. Appeal against the demand of duty for a specific period.
3. Application of Supreme Court decisions on the benefit of discharge of duty on actual production basis.
4. Compliance with Tribunal's directions for determination of ACP on actual production basis.
5. Consideration of declaration filed under Rule 96ZO(3) for availing the Compounded Levy Scheme.

Analysis:
1. The appellants, manufacturers of M.S. Ignots, requested re-determination of ACP under Section 3A(4) of the Central Excise Act for the period from September 1997 to March 1998. The Commissioner initially rejected their request, but the Tribunal remanded the matter for examination of the claim based on actual production. The Supreme Court dismissed the Department's appeal against this decision, upholding the Tribunal's direction.

2. Another duty demand for a subsequent period was confirmed by the Commissioner, but the Tribunal directed re-examination of ACP on actual production basis. The Department's appeal was dismissed, and the matter was remanded for compliance with the Tribunal's directions.

3. The Commissioner relied on Supreme Court decisions to reject the appellants' request for re-determination of duty liability based on actual production, insisting on payment as per the ACP order. The Tribunal emphasized the right granted under Section 3A(4) cannot be negated by a declaration under Rule 96ZO(3), directing the Commissioner to consider the application for actual production determination.

4. The Tribunal reiterated its directive for examining the appellants' claim for ACP on actual production basis under Section 3A(4), emphasizing the binding nature of its order on the Commissioner. The Commissioner was instructed to comply with the Tribunal's directions for the relevant periods and pass a fresh order after providing the appellants with a hearing opportunity.

5. The Commissioner's order was set aside, and the case was remanded for proper compliance with the Tribunal's directions. The Commissioner was mandated to follow the Tribunal's orders for the specified periods and issue a fresh order after granting the appellants a hearing opportunity.

This detailed analysis covers the key issues addressed in the legal judgment, highlighting the Tribunal's directions, the Commissioner's decisions, and the application of relevant legal provisions and court decisions.