2007 (7) TMI 323

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....) and CESTAT have decided the matter against present appellant-assessee. 2. It is an admitted position that the appellant M/s Rajuri Steels Pvt. Ltd. were working under Section 3A of the Central Excise Act, 1944 ("The Act" for brevity's sake), by availing facility of the then prevalent Rule 96-ZP(3) of the Central Excise Rules, 1944 for short "The Rules"). In other words, they were enjoying the facility of payment of excise duty on the basis of annual production capacity in respect of notified goods. The Commissioner determined the production capacity as under Section 3A(1) and (2) and on that basis, assessee was held liable for payment of monthly duty at Rs. 85,175/-. Due to unfavourable market conditions, the factory of the assessee was....

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....goods in accordance with the provisions of this section. (2) Where a notification is issued under sub-section (1), the Central Government may, by rules, provide for determination of the annual capacity of production or such factor or factors relevant to the annual capacity of production of the factory in which such goods are produced, by the Commissioner of Central Excise and such annual capacity of production shall be deemed to be the annual production of such goods by such factory. Provided that where a factory producing notified goods is in operation only during the part of the year, the production thereof shall be calculated on proportionate basis of the annual capacity of production." 4. Factual matrix in the matter is not disputed.....

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.... so paid shal1 be deemed to be ful1 and final discharge of his duty liability for the period from the 1st day of September, 1997 to the 31st day of March, 1998, or any other financial year, as the case may be, subject to the condition that the manufacturer shall not avail of the benefit, if any, under the proviso to sub-section (3) or under sub-section (4) of the Section 3A of the Central Excise Act, 1944 (1 of 1944)." In view of terminal clause underlined for the purpose of emphasis, it is necessary to refer to proviso 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 ....

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....the scheme of payment of one twelfth of the duty payable on the basis of annual production capacity determined, are required to pay the duty at the rate of Rs. 300/- per tonne, as against Rs. 400/- per tonne in the cases covered by sub-rule (1) of Rule 96. Therefore, if the manufacturer desires to enjoy the benefit of the scheme under Rule 96 ZP(3) of payment of annual duty at a lower rate at Rs. 300/- per tonne and by payment in twelve monthly instalments payable before 10th 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 bene....