2016 (9) TMI 785 - HC - Central Excise

Court sets aside Tribunal's hearing direction, affirms dismissal of rectification app, deems appeal maintainable.

Commissioner of Central Excise and Service Tax LTU Versus M/s. Chemplast Sanmar Ltd.

Commissioner of Central Excise and Service Tax LTU Versus M/s. Chemplast Sanmar Ltd. - 2016 (341) E.L.T. 177 (Mad.) Issues Involved:1. Jurisdiction of the Superintendent in finalizing provisional assessments.2. Dismissal of the application for rectification of mistake.3. Maintainability of the appeal against the Superintendent's letter.Issue-wise Detailed Analysis:1. Jurisdiction of the Superintendent in Finalizing Provisional Assessments:The primary issue revolved around whether the Tribunal was correct in remanding the issue to the Superintendent, who is not empowered under the statute to issue orders for the finalization of provisional assessments. The appellant argued that the proper officer for final assessments under Rule 9B of the Central Excise Rules, 1944, is the Deputy or Assistant Commissioner of Central Excise. The court noted that the Superintendent's role was to quantify the differential duty as directed by the Assistant Commissioner. It was clarified that the computation of differential duty by the Superintendent does not constitute an adjudicatory function requiring a hearing. The court concluded that the Tribunal's direction to the Superintendent to provide an opportunity of hearing was not in accordance with the scheme of the Act and rules, and thus, the Tribunal's directions were set aside.2. Dismissal of the Application for Rectification of Mistake:The second issue concerned whether the Tribunal was correct in dismissing the department's application for rectification of mistake. The appellant contended that the Tribunal failed to recognize that the Superintendent's letter was not an appealable order. The court observed that the Tribunal had acknowledged the binding nature of the Supreme Court's decision in Dai Ichi Karkaria's case, which settled the issue on merits in favor of the respondent. The court upheld the Tribunal's decision, stating that there was no error in dismissing the rectification application since the Tribunal had correctly directed the Superintendent to consider the Supreme Court's ruling in the computation of differential duty.3. Maintainability of the Appeal Against the Superintendent's Letter:The third issue addressed the maintainability of the appeal against the Superintendent's letter. The appellant argued that the letter was not an appealable order under the Central Excise Act, 1944, citing the Supreme Court judgments in Flock India Pvt. Ltd. and Priya Blue Industries Ltd. The court examined the letter, which directed the respondent to pay the differential duty and concluded that the letter affected the interests of the respondent. Although the court acknowledged that ordinarily, an appeal against such a letter would not be maintainable, it held that in this specific case, the appeal was maintainable because the finalization of the assessment had to be done in accordance with the Supreme Court's decision in Dai Ichi Karkaria's case. The court clarified that this judgment should not be treated as a precedent.Conclusion:The court disposed of the civil miscellaneous appeal, setting aside the Tribunal's direction for a hearing by the Superintendent and upholding the Tribunal's decision to consider the Supreme Court's ruling in Dai Ichi Karkaria's case for the computation of differential duty. The court also held that the appeal against the Superintendent's letter was maintainable in this specific case. No costs were awarded.