2003 (11) TMI 459 - AT - Central Excise

Tribunal rejects Revenue's appeal on duty payment for steel articles, finds demand time-barred.

The Tribunal rejected the Revenue's appeal, upholding the Commissioner's decision to set aside the demand and penalty imposed for alleged short payment of ... Demand - Duty paid on cast articles of steel from their P.L.A. Issues:1. Alleged short payment of duty on cast articles of steel.2. Adjustment of duty against total duty liability for MS Ingots.3. Appeal against the Order passed by the Commissioner (Appeals).4. Merits of the case and limitation period.Analysis:1. The appeal was filed by the Revenue against the Order passed by the Commissioner (Appeals) alleging short payment of duty on cast articles of steel by the respondents. The duty was claimed to be adjusted against the total duty liability for MS Ingots manufactured by the respondents under the Compounded Levy Scheme. The show cause notice issued to the respondents demanded payment of Rs. 9,49,263.00 for the alleged short payment of duty.2. The Commissioner (Appeals) allowed the appeal filed by the respondents, setting aside the demand and penalty imposed by the original authority. The appellate authority found that the cast articles were cleared by the respondents on payment of appropriate Central Excise Duty from their P.L.A. The Commissioner observed that if there was any short payment of duty in relation to MS Ingots, the Department could proceed for recovery but could not confirm duty against the cast articles again.3. The Commissioner (Appeals) also addressed the issue of limitation, noting that the demand was made using the extended period of limitation. The respondents had filed a declaration under Rule 173B of Central Excise Rules, 1944, and had duly reflected the information in their returns. The Commissioner held that there was no suppression by the respondents, and thus, the demand was barred by limitation.4. The Revenue contested the case on merits but did not challenge the limitation aspect in their appeal memo. The Tribunal found no merit in the Revenue's appeal, stating that the duty paid by the respondents for cast articles had already been adjusted against their duty liability for MS Ingots. Therefore, the Tribunal upheld the Commissioner's decision to set aside the original order and allowed the Department to recover any short payment of duty related to MS Ingots separately.In conclusion, the appeal filed by the Revenue was rejected by the Tribunal based on the findings related to the adjustment of duty, the limitation period, and the lack of merit in the Revenue's case.