Compounded levy opt-out request cannot be rejected for missing production data when departmental records already contain the returns.

A request to opt out of the compounded levy scheme under Section 3A and Rule 96ZO(3) could not be rejected merely because the assessee did not furnish production data, where the relevant monthly RT-12 returns were already available with the department. The prior rejection on the ground of non-production of evidence of lower actual production than the annual capacity fixed by the Commissioner was therefore unsustainable. The matter had to be reconsidered on the basis of production records available in departmental files.

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Issues: Whether the rejection of the appellant's request to opt out of the compounded levy scheme for the years 1998-99 and 1999-2000 on the ground that production data was not furnished was sustainable.

Analysis: The appellant had earlier opted for duty payment on annual capacity basis under Section 3A of the Central Excise Act, 1944 read with Rule 96ZO(3) of the Central Excise Rules, but later sought to pay duty on actual production for the relevant years. The request was rejected on the ground that the appellant had not produced evidence of lower actual production than the annual capacity fixed by the Commissioner. The available record showed that monthly RT-12 returns had been filed with the departmental Range Office, from which the production data could be obtained. In these circumstances, rejection merely for want of data from the appellant was not justified.

Conclusion: The rejection of the request was unsustainable and the matter was required to be reconsidered on the basis of production data available with the department.

Ratio Decidendi: A request to move out of a compounded levy scheme cannot be rejected for non-furnishing of production data by the assessee when the relevant data is available in departmental records.

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