TMI Blog2023 (8) TMI 610X X X X Extracts X X X X X X X X Extracts X X X X ..... clear revenue neutral situation hence, in these circumstances, the demand cannot be raised particularly when the abatement procedure was followed by the appellant and machine was admittedly closed for minimum of 15 days in every month during August, 2011 to March, 2012 therefore, demand of duty is not sustainable. The very same issue has been considered by the Hon ble Supreme Court in the case of COMMISSIONER OF CENTRAL EXCISE VERSUS M/S ANGADPAL INDL. PVT. LTD. [ 2015 (10) TMI 1844 - SUPREME COURT] wherein the Apex Court has held that the respondent was not supposed to pay any duty, more so, when the entire exercise was revenue neutral. It legitimately claimed the rebate. The appellant are entitled for the abatement and consequently not required to pay any duty during the period machines were not working - the impugned order is set aside - Appeal allowed. - HON'BLE MEMBER ( JUDICIAL ), MR. RAMESH NAIR And HON'BLE MEMBER ( TECHNICAL ), MR. C. L. MAHAR Shri Vijay B Joshi, Advocate for the Appellant Shri Rajesh K Agarwal, Superintendent ( AR ) for the Respondent ORDER RAMESH NAIR The brief facts of the case are that the appellant are eng ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... II 2015 (325) ELT 228 (SC) Commissioner Vs. Thakkar Tobacco Products Pvt Ltd 2016 (332) ELT 785 (Guj.) CBEC Circular : 1063/2/2018 CX dated 16.02.2018 3. Shri Rajesh Kumar Agarwal, Learned Superintendent (AR) appearing on behalf of the Revenue reiterates the finding of the impugned order. 4. We have carefully considered the submissions made by both the sides and perused the records. We find that even though the Rule 9 prescribes that the duty under the scheme should be paid by 5th of the same month but at the same time Rule 10 provides abatement for the machine as not working minimum of 15 days. In the present case as regard the closure of machine for minimum 15 days and procedure for claiming the abatement has been undisputedly followed and is not objected by the department. Therefore the appellant in principle become entitled for abatement even if the appellant have not paid duty in advance by 5th of same month for the days when the machine was not working the duty was not payable in advance, the same shall stand adjusted against the duty not liable to be paid. Therefore this is a clear revenue neutral situation hence, in these circumstances, the demand can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of Stenter of PRIMATEX for the period of closure from 10-1-2000 to 18-1-2000 wherein the duty payable on the stenters installed in the factory premises has to be paid in advance during the months of November, 1999, to February, 2000, in terms of closure (e) to sub-rule (7) of the Rule 96ZQ of the Rules. 7. Department s case is that Notification No. 18/99-C.E. (N.T.), dated 28-2-1999 amended the provisions of Rules 96ZQ by inserting clause (e) and according to clause (e), when the claim for abatement by independent processors is for a period less than one month, he shall be required to pay the duty as applicable for the entire period of one month and may, subsequently, seek such claim after payment of such duty and in view of this insertion, the conditions of prior payment of duty for claiming abatement were applicable from 28-2-1999 onwards. 8. The submission of Mr. A.K. Sanghi, learned senior counsel appearing for the Revenue, is that the Customs, Excise and Service Tax Appellate Tribunal (hereinafter referred to as CESTAT) has relied upon a circular dated 15-9-1999 to give the benefit to the respondent-assessee herein which is not the correct approach inasmuch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... abatement on the ground that the factory was closed for 9 days and 10 days respectively during the period 18-5-98 to 27-5-98 and 17-6-98 to 27-6-98 has been rejected by the Commissioner on the ground that since closure was for a period of less than one month, the assessee ought to have paid duty liability and then sought abatement, in terms of Rule 96ZO of the Central Excise Rules, 1944. 2. We have heard both sides and perused the rule in question and find that there is no such stipulation contained therein. Even in case of Rule 96ZQ, where there is such a condition prescribed, the Tribunal has held in the case of Varun Silk Mills P. Ltd. v. CCE, Surat, 2007 (214) E.L.T. 227 (Tri.-Ahmd.) that abatement benefit is a substantial benefit which cannot be denied only on the ground that the assessee did not pay duty first and then claim abatement. In the absence of any such condition in Rule 96ZO, which is relevant rule in the present case, the benefit of abatement should have been extended. The Commissioner has read into a rule something does not exist thereunder. We, therefore, set aside the impugned order and allow the appeal. 7. We find that the Board vide Circular No.331 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out asking him to pay duty first or where he had paid the duty, he should be reimbursed the amount of duty paid, in terms of the order of abatement issued by the Commissioner. It is seen that the situation obtaining in the present appeals is quite akin to situation dealt with in the above circular dt.28.02.1999. The Adjudicating authority has refused to follow the ratio of the said circular on the ground that the said circular was issued only for the period 16.12.1998 to 27.02.1999. While the Commissioner is technically right in his observation, it needs to be pointed out that the period (upto 27.02.1999) was mentioned in the said circular only because the said Rule was amended w.e.f. 28.02.1999. In the case of Steel Industries of Hindustan Industrial Area Vs CCE Ghaziabad- 2013 (293) ELT 191 (All.) while interpreting Rule 96ZP of the erstwhile Central Excise Rules, the Allahabad High Court observed that there is no pre-condition for depositing of duty for claiming abatement under Rule. Earlier, in the case of Varun Silk Mills Pvt. Ltd Vs CCE Surat-I - 2007 (214) ELT 227 (Tri-Ahmd.) involving a similar situation, the Tribunal held as under:- 4. I have carefully consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the present appeals. The reference was also made by ld.D.R. to the case of K.P. Pan Products Pvt.Ltd (supra) but the issue there was whether the continuous period of 15 days of closure of the factory should necessarily fall during a particular calendar month and the Tribunal held that the said period of 15 days of continuous closure could fall in the two adjacent months also. Thus, this judgment is of no avail to the Revenue. As regards the Board s circular dt.12.03.2009 stating that the abatements are subject to pre/post-audit, we do not necessarily see any fatally irreconcilable contradiction between the Board s circulars dt.15.09.1999 30.08.1997 on the one hand and the one dt.12.03.2009 on the other in as much as when the adjustment of abatement has been made, nothing prevents Revenue froma auditing the correctness thereof. More importantly, the Board s circulars have no statutory force and have to be ignored to the extent they are in conflict with the judicial pronouncements. 9. It is quite evident from the foregoing that apart from the Board s circulars dt.30.08.1997 and 15.09.1999 referred to earlier, in a series of judicial pronouncements, a consistent approach h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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