2004 (4) TMI 194

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....med duty of Rs. 59,910/- in respect of the processed fabrics of cotton shirting and duty of Rs. 39,093/- regarding 12 bales of suitings, on them for having cleared these goods without payment of duty. 2. The learned Counsel has contested the validity of the impugned order confirming the demand under Section 11D of the Act by contending that the provisions of this Section during the relevant period i.e. 16-12-1998 to 28-2-2001 were not attracted to the appellants as they were paying the duty in terms of Section 3A of the Act on the basis of the production capacity/number of chambers of the stenter and as such had nothing to do with the quantity of the goods manufactured and cleared by them during that period. To substantiate his contentio....

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....s to be accepted. Admittedly, the appellants were engaged in processing textile fabrics with the aid of hot-air stenter being an independent processor during the period in question and the goods manufactured by them were notified to be subject to Central Excise duty payable on the basis of capacity of production. Their duty liability under Section 3A of the Act read with Hot-Air Stenter Independent Textile Processor Annual Capacity Determination Rules, 1988 was accordingly determined by the Commissioner at Rs. 7,973 lacs per month for the period 16-12-1998 to 28-2-2000 vide order dated 28-2-2001 and at Rs. 10 lacs per month for the period 1-3-2000 to 28-2-2001 vide order dated 24-11-2000. They paid the duty accordingly in terms of these ord....

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....g the notional rate of duty on the individual clearances, in some invoices, as they were not required to pay the duty on the individual clearances, because they were working at that time under the Compound Levy Scheme under which they were required to pay the duty in lump sum, determined on the basis of their production capacity under Section 3A of the Act irrespective of the fact that whether they were able to recover that much duty from their customers or not. Their duty liability under Section 3A of the Act was not correlated to the clearances of the goods made by them during the period in dispute. Therefore, it was not incumbent upon them to disclose even the notional rate of duty leviable on the individual clearances made by them, in t....