TMI Blog2012 (12) TMI 158X X X X Extracts X X X X X X X X Extracts X X X X ..... the quantity leviable for the duty. In Rule 5, even after declaring that actual production of the mill will be the annual capacity of the production shall be determined by the formula under sub-Rule 3 of Rule 3, but it has been restricted to apply for only financial year 1996-97. In view of the Rule 5 also, even actual production of previous year i.e. for the F.Y 1996-97, by application of the deeming Clause under Rule 5, that is not the basis annual capacity of production for the subsequent years. Therefore said notice was barred by the period of limitation of six months. In favour of assessee - Tax Case No. 14 of 2001 - - - Dated:- 5-11-2012 - MRS. JAYA ROY AND PRAKASH TATIA, JJ. For the Petitioner: M/s Deepak Roshan, Sr. S.C. Amit Kr, Rupa Kumari, Advocates Heard the counsel for the petitioner. Nobody appears for the respondent in spite of the service. The assessee is manufacturer of the rerolled product of non-alloy steel falling under Chapter 72 of the Schedule to the Central Excise Tariff Act, 1985, on such product, duty of the Excise is leviable in terms of the provisions of Section 3A of the Central Excise Act, 1944 read with Rule 96 ZP of the of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner has fixed the annual capacity in terms of the Sub Rule (3) of Rule 3 of the said Rules of 1997 whereas the Revenue's case is that it is Rule 5, which has to be applied. The tribunal held that 'in absence of any suppression on the part of the assessee, it was not open to the Commissioner to review his own order retrospectively'. In view of the said decision of the tribunal dated 15.5.2001, the Revenue has preferred this Tax petition. Learned counsel for the Revenue, Sri Deepak Roshan vehemently submitted that the Rule 5 has full application to the facts of the case and once the production is higher than the annual production capacity determined under the Sub Rule (3) of Rule 3 above, by virtue of the Rule 5, the duty is leviable on the actual production it is higher than C.A.P. determined under Sub Rule 3 of Rule 3. In view of the above reasons, the tribunal's order is absolutely contrary to the law. We have considered the submissions of the learned counsel for the petitioner and perused the order passed by the Assessing Officer dated 4.6.1999 and the order passed by the CEGAT dated 15.5.2001. It appears that the show cause notice was given to the assessee on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during the financial year 1996-97, then the annual capacity so determined shall be deemed to be equal to the actual production of the mill during the financial year 1996-97 For the financial year 1996-97 assessee's unit annual production capacity was determined under Sub Rule (3) to be 3044.531 metric ton. It appears that there was no dispute with respect to the actual production of the assessee's unit for financial year 1996-97 and the assessee itself furnished the relevant documents on the basis of which, it has been held that actual production of the assessee's unit was 6095.795 metric ton against determined (estimated) production capacity of 3044.531 metric ton. The Assessing Officer was, therefore, rightly asked to pay the duty on the above quantity in view of the Rule 5. The assessee in response to the said show cause notice dated 12.3.1999, in its reply dated 5.5.1999, replied that annual production capacity was rightly determined for the year 1996-97 and it appears that the assessee did not chose to contest the issue of its actual production of 6095.795 metric ton and it only pleaded that it furnished the correct information to the Department and the assessee will pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... effect from 1.9.1997, obviously only on the basis of actual annual production of assessee's unit in the year 1996-97 and it has not re-determined the annual production capacity under Sub-Rule 3 of the Rule 3 for subsequent years. The operative part of the order is as under: In view of foregoing discussions, I fix annual capacity of production in respect of mill of the assessee as 6095.795 MT under Rule 5 of the Hot Rerolling Steel Mills Annual Capacity Determination Rule 1997 w.e.f. from 1.9.97. The assessee is directed to pay the differential duty payable by them during 1997-98 and 1998-99 in pursuance of this order forthwith. The penalty and interest shall be leviable as per provisions of Rule 96ZR. However, for determination of the annual capacity of the production of Hot Rerolling products of non-alloy steel is provided under Sub Rule 3 of Rule 3. A complete formula has been prescribed as to how this annual capacity of production will be determined. It appears that the determination of the annual production capacity for such mill has its own object and such provision has been made so as to see the industrialists who are engaged in such industry, should not avoid the duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 999 which is apparent from the operative part of the order. It appears that in view of the show cause notice, which is relating to the demand of the differential duty for the produce of the year 1996-97, and for determination of the annual capacity of production, some confusion may have crept and the another confusion may be because of the reason that in the Rules of 1997, it has been provided that if the actual production of the industry is more than the annual capacity of the production determined by the formula under sub-Rule 3 of Rule 3, then in that situation, the capacity so determined under sub-Rule 3 of Rule 3 shall be deemed to be equal to the actual production of the mill. Such confusion could have been avoided by saying that the duty leviable for the produce of the mill in excess to the annual capacity of production determined by the formula under sub-Rule 3 of Rule 3 will be the quantity leviable for the duty. In Rule 5, even after declaring that actual production of the mill will be the annual capacity of the production shall be determined by the formula under sub-Rule 3 of Rule 3, but it has been restricted to apply for only financial year 1996-97. Then it cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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