2005 (11) TMI 403 - AT - Central Excise

Summary

Issues:
Challenge of demand confirmation based on ACP determination and factory closure notification.

Analysis:
The appellants contested the demand confirmation by the Order-in-Appeal, arguing that they had indeed filed an application for surrendering the license and notifying the closure of the factory to the Superintendent. The Commissioner (Appeals) noted the absence of a letter dated 26-3-98 regarding the factory closure, but the appellants claimed that the Department had acknowledged receiving the letter by affixing their seal on it. The Commissioner held that the ACP determination on 14th October, 1998, was not a statutory declaration under Rule 96ZP, as it was merely an intimation filed by the appellants on 6-5-98. The order should have been issued by April 1998 as per the rules, but it was delayed until October 1998. Referring to the Supreme Court judgment in U.O.I. v. Supreme Steels and General Mills [2001 (133) E.L.T. 513 (S.C.)], it was established that ACP determination should be done at the beginning of the year. Therefore, the appellants' claim of closing the factory in April 1998 with due intimation to the Department was accepted, especially since the Department had acknowledged receiving the closure letter. The lower authority's finding that the Department had not received the closure intimation could not be upheld. The order passed in October 1998 for recovery of the demand was deemed unsustainable, and the appeal was allowed.

This judgment primarily revolves around the proper determination of ACP and the notification of factory closure. The key issue was whether the appellants' actions complied with the legal requirements and timelines for ACP determination and factory closure notification. The appellants argued that they had fulfilled the necessary steps by submitting the closure letter, which the Department had acknowledged. The Commissioner, however, found discrepancies in the timing and nature of the submissions, leading to a delay in the ACP determination. The judgment emphasized the importance of adhering to statutory rules and timelines, as highlighted by the Supreme Court precedent cited.

In conclusion, the judgment highlights the significance of timely and accurate compliance with statutory requirements, particularly concerning ACP determination and factory closure notifications. The case underscores the need for strict adherence to legal procedures and deadlines to avoid disputes and ensure fair treatment in matters of demand confirmation and related issues.