TMI Blog2001 (9) TMI 483X X X X Extracts X X X X X X X X Extracts X X X X ..... ries Ltd.), No. E/403/2001/NB (D) (M/s. Baba Balak Nath Steels Ltd.) and No.E/405/2001/NB (D) (M/s. Dhiman Industries). Appeal No. E/405/2001 had been directed against the order dated 29-11-2000. Appeal No. E/404/2001 has been filed against order dated 28-11-2000 and other three Appeals Nos. E/401/2001, E/402/2001 and E/403/2001 have been filed against the orders dated 30-11-2000. All these orders have been passed by the Commissioner vide which, he had determined the Annual Production Capacity (in short APC) of the units of all the appellants by applying Rule 5 of the Hot Re-rolling Steel Rolling Annual Capacity Determination Rules (in short HRSMACD Rules). 2. The appellants were operating hot steel re-rolling mills. They were engaged in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 11A of the Central Excise Act. However, in the other three Appeals Nos. E/402, E/403 and E/405, only one issue is involved :- whether the recovery of short paid duty by the appellants could be effected without complying with the provisions of Section 11A of the Act. 4. We proceed to decide the first issue involved in Appeals Nos. E/401 and E/404 first, as the second issue is common in all the five appeals and would be taken up thereafter. 5. Admittedly, the appellants of Appeals Nos. E/401 and E/404 had been discharging their duty liability initially on the basis of APC of their units, in terms of Section 3A of the Central Excise Act. They opted for payment of duty in terms of sub-rule 3 of Rule 96ZP of the Central Excise Rules, on i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ases, there is ample material on record to show that there was decrease in the APC of the units of both these appellants of Appeals Nos.E/401 and E/404. In the case of appellant of Appeal No.E/401, it is evident from the record that in the year 1996-97, he had rolling mill of size 203.2 mm (8') which he reduced to 195 mm at the time of introduction of compound levy scheme. To substantiate these facts, he had produced certificate of assessed capacity issued by the Department of Industries, Punjab which shows that he had rolling mill of the size 203.2 mm (8'). He later on reduced to 195 mm as is evident from the copy of the invoice dt. 16-8-1997 vide which he paid the labour charges for effecting the reduction. This evidence had not been acce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red case. Therefore, in both these appeals the impugned orders of the Commissioner in the appeals cannot be sustained and must be set aside. The APC of the units of the appellants of these appeals as determined under Rule 3 of the HRSMACD Rules is to be accepted, as correct. 10. This takes us to the second issue which is common in all the appeals, as to whether the alleged short paid differential duty could be recovered from the appellants of all the appeals without complying with the provisions of Section 11A of the Central Excise Act, by issuing detention and attachment order straight-away against them, as has been done by the Commissioner through impugned orders. 11. The ld. SDR has tried to justify the impugned orders of the Commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section are mandatory and without complying with the same, no recovery of short paid duty can be effected from an assessee. In this context reference may be made to Apex Court Judgment in the case of Gokak Patel Volkart Limited v. CCE, Belgaum reported in [1987 (28) E.L.T. 53 (S.C)]. In that case it has been ruled by the Apex Court as under : The provisions of Sections 11A(1) and (2) makes it clear that the statutory scheme is that in the situations covered by sub-section (1) a notice of show cause has to be issued and sub-section (2) requires that the cause shown by way of representation has to be considered by the prescribed authority and then only the amount has to be determined. The scheme is on consonance with the rules of natural j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or detention/attachment of the goods were passed by the Commissioner. The appellants challenged those orders of the Commissioner and the same were set aside by the Tribunal, as is evident from the record and the cases were remanded with direction to adjudicate those show cause notices. But the Commissioner instead of adjudicating those notices had observed that the issuance of the show cause notices was not necessary for recovery of short paid duty from the appellants. His observations runs contrary to the provisions of Section 11A of the Act and the ratio of the law laid down by the Apex Court in the above referred cases. Therefore, the letters issued by the Superintendent to the appellants for recovery of the short paid duty, in pursuance ..... X X X X Extracts X X X X X X X X Extracts X X X X
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