2012 (10) TMI 75 - HC - Central Excise

Dismissal of Excise Appeal Upholding Waiver Rejection under Section 35-F: Legal Interpretation

The Central Excise Appeal under Section 35-G was dismissed by the court, upholding the Tribunal's decision to reject the waiver application under Section ... Mini cement plant - Whether the entry at Serial No. 28 of the exemption Notification No. 14/2008-CE (NT) was wrongly interpreted by the Adjudicating Officer - Held that:- Application for waiver of the excise duty and interest rejected - Held that:- The Tribunal has found that the entry at Serial No.28 relates to white cement and not grey cement manufactured by the appellant-company. No other type of cement has been granted abatement by any notification - as mentioned in SCN notification dated 1.3.2006, as amended, prescribes the effective rate of duty for excisable goods falling under Tariff item 2523 29 in which different rates of excise duty has been prescribed for units manufacturing cement on the basis of the type of manufacturing plant, and on the basis of form, in which the clearances are affected by the unit concerned. The appellant's factory does not qualify as mini cement plant as defined in the notification. Thus the Tribunal rightly found that the appellant does not have a prima facie case for waiver of the excise duty and the interest. Since the appellant-company has not ceased production, and is making payments to the bank and financial institutions no substance in the plea of undue hardship or financial hardship in depositing the amount - the period of deposit is extended by six weeks from today - against assessee. Issues:Central Excise Appeal under Section 35-G of the Central Excise Act, 1944; Waiver application under Section 35-F; Interpretation of exemption Notification No. 14/2008-CE (NT); Prima facie case for waiver of excise duty and interest; Financial hardships; Benefit of abatement under Notification No. 14/2008-CE (NT); Scope of show cause notice; Declaration as Sick Industrial Company; Undue hardships.Analysis:1. The judgment involves a Central Excise Appeal under Section 35-G of the Central Excise Act, 1944, arising from the order of the Customs, Excise & Service Tax Appellate Tribunal. The Tribunal had rejected the appellant's application for waiver under Section 35-F as a precondition for filing the appeal, directing the appellant to deposit a specific amount within a stipulated time frame.2. The appellant had challenged the Tribunal's order on the grounds of interpretation of exemption Notification No. 14/2008-CE (NT). The Tribunal found that the appellant did not establish a prima facie case for waiver of excise duty and interest, dismissing the appeal based on the interpretation of the exemption notification and the applicable rates of excise duty for different types of cement manufacturing units.3. The judgment also addressed the appellant's claim of financial hardships, citing the appellant's status as a Sick Industrial Company under the Special Provision Act. The court considered the appellant's financial situation, including rescheduled payments to financial institutions, and found no merit in the plea of undue financial hardship for depositing the required amount.4. The appellant further contended that the benefit of abatement under the notification was applicable to specific types of cement falling under certain headings in the Central Excise Tariff Act. The court, after considering similar submissions made in a previous appeal, upheld the Tribunal's decision and found no error in the order.5. Additionally, the judgment discussed the scope of the show cause notice and emphasized that the impugned order did not exceed the notice's scope. The court extended the period for depositing the amount by six weeks from the date of the judgment, ultimately dismissing the Central Excise Appeal based on the findings related to waiver application, interpretation of exemption notification, financial hardships, and the benefit of abatement.