TaxTMI 
TaxTMI 
2017 (5) TMI 693
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.... to pay duty for the period September 1997 to March 2000. The appellants had not paid any duty at all. The demands were confirmed by the lower authorities. Aggrieved by the said order, the appellants are before the Tribunal. 2. Ld. counsel or the appellants argued that though the capacity of the unit was fixed under Rule 97ZP(3), the unit was closed from 20.04.1998 to 26.05.2000 and therefore no duty can be demanded from them. Ld. counsel argued that duty can be demanded only if there is production in any month. He argued that since there is no production during the period of closure no duty can be demanded. Ld. counsel pointed out that vide letter dated 20.04.1998 they had given an intimation of closure of unit and vide letter dated 24.....
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.... 96ZO(3) of Central Excise Rules, 1944. He asserts that the two procedures one provided under sub-section (4) of Section 3A of Central Excise Act, and as provided under sub-Rule (3) of 96ZO are alternate procedure and assessee as to opt for one. 5. We have gone through the rival submission. 6. We find that the decision of the Tribunal in Hamdum Iron & Steel Enterprises Ltd. (supra), Digamber Foundry (supra) and Sanjay Alloys Pvt. Ltd. (supra) all rely on the decision of the Tribunal in the case of Malviya Steel Ltd. (supra). In the case of Malviya Steel Ltd. in para 5, 6 and 7 the Tribunal has held as under:- "5. The annual capacity of production of a unit is determined by the Commissioner under the provisions of Hot Re-Rolli....
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....s judgement no where refers to the provisions under the proviso to Section 3A(2). 7. In view of the above analysis, therefore, we hold that the benefit of abatement from payment of duty for the period of closure of the mill is available to the appellants under Section 3A(2). The appeal is accordingly allowed by setting aside the impugned order of Commissioner (Appeals)." However, the Hon'ble High Court of Bombay in the case of Rajuri Steels Pvt. Ltd. (supra) has examined identical issue and held as follows:- "4. To consider whether any substantial question of law arises in this appeal, it is necessary to refer to Rule 96-ZP(3) of the Rules, which prescribes procedure to be followed by the manufacturers of Hot Re-rol....
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....oviso to sub-section (3) and sub section (4) of Section 3A. Sub Section (3) speaks about powers of the Central Government to issue notifications regarding rates at which duty of excise on notified goods is to be levied and the manner of collection. Proviso reads thus; "Provided that, where a factory producing notified goods, did not produce the notified goods during any continuous period of not less than seven days, duty calculated on a proportionate basis shall be abated in respect of such period if the manufacturer of such goods fulfils such conditions as may be prescribed." Sub-Section 4 reads as follows; "Where an assessee claims that the actual production of notified goods in his factory is lower tha....
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....re 10^th of every calendar month, the condition is that he shall not have benefit of proviso to sub-section (3) as also sub section (4) of Section 3, which we have already reproduced hereinabove. If the proviso to sub-section (3) is not available, the manufacturer-enjoying benefit of payment by the procedure prescribed under Rule 96-ZP(3) shall have no remission, merely because production had come to halt for certain period, although exceeding seven days." Hon'ble High Court while dealing with the identical issue has held that in case of manufacturer opts for Rule 96ZP(3) benefit under the proviso to sub-section (3) or sub-section (4) of Section 3A of the Central Excise Act, 1944 cannot be availed. In view of the decision of Hon'....