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TMI Blog2006 (4) TMI 164X X X X Extracts X X X X X X X X Extracts X X X X ..... of duty by the Revenue for the period of 3 months commencing from 1st June, 1998 to 31st August, 1998 as compounded duty in respect of cold rolling machines which were ceased to operate w.e.f. 29th May, 1998 and were not in operation at any time during the said period. 4. The respondent-assessee had two cold rolling machines for processing the aforesaid articles. Under Chapter E-VI of the Central Excise Rules, 1944 for manufacturing of stainless steel pattas and patties the assessee availed the special procedure for levy of duty as envisaged thereunder. The Chapter E-VI of the Rules of 1944 contained the provisions from 96ZA to 96ZGG. This special procedure can be availed by the assessee in lieu of the provisions contained in the rules elsewhere for the period in respect of which the application is granted by the Commissioner. 5. The application made by the assessee under Rule 96ZA had been granted by the Commissioner and the assessee was availing the special procedure for payment of duty as per the said procedure for the period, the permission was granted, which has not expired. The assessee was permitted to avail the special procedure for payment of duty. 6. Un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the provisions of Section 96ZB is very clear and does not give any power for calculating the aforesaid duty only on the actual number of machines installed and working during the period. 11. On further appeal, the Tribunal vide its order dated 8-8-2001 [2001 (137) E.L.T. 1018 (Tri-Del.) upheld the contention of the assessee and allowed the appeal and directed the refund of amount paid for the period during which the machine was not in operation. The Tribunal opined that none of the Rules under Chapter E-VI contemplates charge of duty after the machine has been dismantled and production of that machine is discontinued and there is no bar also contained in the special procedure as per rules or in Section 11B prohibiting refund of excess duty paid by an assessee working under the Special Procedure Rules. The Tribunal was of the opinion that since in the present case, there is no dispute that the machine was dismantled on 29-5-1998 and found that despite the duty was ordered to be paid in respect of the dismantled machine for 3 months i.e. June 98 to August 98, this payment was clearly in excess of the sum payable under Compounded Levy Scheme. That amount is refundable in te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en paid. 15. Apparently, the rate of levy of excise duty in respect of stainless pattas/patties subjected to cold processing by the cold rolling machines is determined on the average production of per machine. It is indicative of the fact that the total production instead of being measured on actual terms is measured on estimated basis per machine. Thus, under the special procedure the excise duty is levied on the processing or manufacture of stainless steel pattas/patties of a given quantity per machine and retain the basic character of excise duty leviable on the manufacture of goods. The measure of manufactured articles, as per the special procedure is determined on the basis of estimated manufacture per machine and accordingly, levy is also payable on estimated manufactured articles per machine at the prescribed rate for such manufactured articles per machine for a given period but the rate is applicable to the production of article by the machine concerned. It is not de-linked. Sub-rule (2) on which the reliance has been placed by the Revenue to claim that excise duty is leviable in respect of cold rolling machines which was not in existence during the period by dint of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y such change." The scheme of Rule 96ZC is clear, if it is read in the context of principal charging section of parent Act. 17. Under Section 3 of the Central Excise Act there shall be levied and collected in such manner as may be prescribed duties of excise on all excisable goods which are produced or manufactured in India. Section 4 provides that where under this Act, the duty of excise is chargeable on any excisable goods with reference to value, such value shall subject to other provisions of this section be deemed to be the normal price thereof at which goods are ordinarily sold by the assessee to a buyer in the course of delivering at the time and place of removal of excisable articles. The excise duty is payable on the removal of goods from the place of manufacture or from the place where they are permitted to be stored at the rate specified for levy of excise duty at any particular article in terms of relevant provisions of law. In other words, the levy of duty on removal of goods to be measured on the quantity of goods removed each time at a rate applicable to such goods at the relevant date and in this process, the entire manufactured goods so removed from the plac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to payment of duty as per the regular duty and not under the special procedure. Sub-rule (1) which requires making of application does not deal with making an application for removal of one or more machines from the existing premises. The sub-rule (3), which deals with the change in number of cold rolling machines does not require any such specified application but only requires the manufacturer that he has to intimate the officer in writing of any change in the number of machines. 21. Apparently, the distinction has to be drawn in this context between requirement of application under Section 96ZC before removing the goods and the requirement of intimating the officer before removing the machine itself. 22. The application is in respect of removal of the manufactured articles from the premises whereas intimation only is needed in respect of change in machines installed in the factory premises. Apparently, the Assistant Commissioner as well as the Commissioner (Appeals) were under impression that application required under Rule 96AC relates to removal of cold rolling machines whereas there is no such requirement of making such application in that regard. 23. It goe ..... 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