Appeal granted for abatement under Rule 10, refund of duty paid due to machine non-operation.

The Tribunal allowed the appeal, determining that the appellant qualified for abatement under Rule 10 for the non-operational period of one machine, entitling them to a refund of duty paid. The Tribunal held that the statutory conditions were met as the machine was non-operational for over 15 days, contrary to the jurisdictional Assistant Commissioner's denial of the refund. The decision overturned the order-in-appeal, finding it lacking merit.

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Issues Involved:
1. Eligibility for abatement of duty under Rule 10 of the Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rules, 2010.
2. Requirement to seal all packing machines for claiming abatement.
3. Interpretation and application of relevant provisions and case laws.

Summary:

1. Eligibility for abatement of duty under Rule 10:
The appellant, engaged in the manufacture of branded unmanufactured tobacco, filed a claim for abatement in the form of a refund for the period from 15.05.2010 to 31.05.2010, during which one of their machines was sealed and not in operation. The jurisdictional Assistant Commissioner issued a show cause notice denying the refund on the grounds that both machines should have been sealed to qualify for abatement.

2. Requirement to seal all packing machines:
The Assistant Commissioner and the Commissioner (Appeals) held that the appellant did not fulfill the statutory conditions under Rule 10, as the factory was in operation with one machine running throughout May 2010. The appellant contended that only the non-operational machine needed to be sealed, and relied on several decisions supporting this interpretation.

3. Interpretation and application of relevant provisions and case laws:
The Tribunal examined Rule 10 and related provisions, concluding that abatement is allowed if a machine is non-operational for more than 15 days. The Tribunal referred to CBEC Circular No. 980/04/2014-CE, which clarified that duty is based on the number of operating machines and not on actual production. The Tribunal found that since one machine was not operational for 17 days, the appellant was entitled to a refund of the duty paid in advance.

Conclusion:
The Tribunal allowed the appeal, holding that the appellant met the conditions for abatement under Rule 10 and was entitled to a refund for the non-operational period of one machine. The order-in-appeal was found to be without merit.

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