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2015 (10) TMI 422 - CESTAT MUMBAI

2015 (10) TMI 422 - CESTAT MUMBAI - 2015 (323) E.L.T. 582 (Tri. - Mumbai) - Denial of abatement claim - production capacity based duty - whether appellant is entitled for abatement as provided under Section 3A of the Central Excise Act, 1944 - Held that:- Appellant indeed, have been intimating to the department from time to time vide various correspondence regarding the closure and restarting of the production in their factory. Ld. Commissionerís finding for rejecting the claim of abatement is b .....

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denying the abatement. - as intimations given by the appellant from time to time to the department, correspondence of the electricity department and the facts narrated in Honíble Bombay High Court at Goa bench there is no dispute that production of the appellant factory remained closed during the period declared by them to the department and this fact also not disputed by the Ld. Commissioner. - appellant is legally entitled for abatement and accordingly the demand is not sustainable. We theref .....

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Commr. Goa/Cx/2004 dtd. 20/1/2005 passed by the Commissioner of Customs & Central Excise Goa, wherein total demand of ₹ 54,04,368/- was confirmed in terms of Rule 96ZO(3) of the Central Excise Rules, 1944. A penalty of equal amount and interest on the demand was also confirmed. The fact of the case is that the appellant is engaged in the manufacture of mild steel ingots falling under chapter 72 of the First Schedule to the Central Excise Tariff Act, 1985. The appellant filed declaratio .....

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on of the assessee vide letter F. No. V/30/16(k)/97-CX.I dated 18/3/1998 and according to such fixation capacity of the induction furnace installed in the appellant s factory was fixed at 3 M.T. and accordingly appellant is required to pay Central Excise duty of ₹ 5 lakhs per month. Since the appellant did not pay full amount of Central Excise duty during the period of October, 1997 to March, 2000, five show cause notices were issued demanding total duty of ₹ 54,04,368/-. In the firs .....

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emand and imposed penalty and interest vide impugned order dated 20/1/2005, therefore appellant is before us. 2. Shri. S. Sunil, Ld Counsel for the appellant submits that the Ld. Commissioner has wrongly rejected the abatement claim of the appellant on the ground of non fulfillment of procedural requirements. He submits that the appellant had intimated the department regarding the closure of the factory as well as restarting of production. The appellant also submitted that electricity bill for t .....

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bmits that Goa Bench of Hon ble High Court had acknowledged in it s order the fact that 20 days for every month there was no power supply in the factory. In the Hon ble High Court order dated 12/6/1998 while discussing writ petition of the appeal disclosed that Ld Advocate acknowledged the fact that power supply cut to the appellant factory. This vital fact was available on record before Ld. Commissioner and same was recorded in the impugned order. Despite all these undisputed fact and evidences .....

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that from which date to which date and hours factory remained closed. In such a situation merely for non intimating the particular hours can not be reason for denial the abatement. In support of his submission he placed reliance on this Tribunal judgments in the case of Bata Steel Pvt. Ltd. Vs. Commissioner of C. Ex., Chandigarh[2007(219) E.L.T. 539(Tri. Del)] and Commissioner of Central Excise, Kanpur Vs. Daksh Steels Pvt. Ltd [2004(178) E.L.T. 446 (Tri. Del)] . He submits that in view of the a .....

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ure of the appellant factory, it is observed that the Ld. Commissioner has rejected the claim of the appellant on the ground that even though the appellant had informed the department about closure of the unit on particular date and starting of the production on particular date but failed to inform the department as to the period for which the unit was continuously closed from particular hours of particular day to particular hours of particular day. In this regard we have perused the relevant do .....

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mained closed on 18/12/1997, vide letter dated 29/12/1997 intimated furnace was remained closed from 20/12/1997 and now it is ready for production from today, vide letter dated 22/2/1998 it was informed to the Asstt. Commissioner that the furnace is going to remain closed due to technical problem of furnace, vide letter dated 9/2/1998 it was intimated to the Commissioner that the furnace remain closed and now it is ready for production from today. Vide letter dated 9/3/1998 informed to the Asstt .....

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pellant also submitted the statement of closure and starting of furnace showing date and time and number of days of closure. We also gone through the letter from the electricity department wherein it can be seen that there was power restrictions imposed on the appellant s factory. This also goes on proving that factory remained closed as intimated by the appellants from time to time. As pointed out by the Ld. Counsel it is seen from the Hon ble Bombay High Court at Goa bench judgment in the case .....

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ening of six new industries the Government now is not in a position to maintain supply as agreed. The impugned communication was therefore, issued. From the above undisputed fact it is observed that the appellant indeed, have been intimating to the department from time to time vide various correspondence regarding the closure and restarting of the production in their factory. Ld. Commissioner s finding for rejecting the claim of abatement is boiled down on only one aspect that is during intimati .....

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