2005 (3) TMI 318

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....posed an equal amount as penalty and demanded interest. 2. The present appeal contends that the amount demanded under the order is not due at all and for that reason the duty and other demands made under the impugned order are required to be set aside. It is pointed out that the appellant was paying duty under Rule 96ZO(3) of the Central Excise Rules and that Rule envisages payment of a fixed sum for furnace capacity of 3 MT and prorata payment if the capacity is more or less the 3 MT. It is being contended that the appellant's capacity was only 2.5 MTs during the relevant period and duty due on that capacity had been paid. With regard to the alleged additional capacity of 4 MT it is being pointed out that the appellant had informed abou....

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....lso relied on the decision of this Tribunal in the case of Jindal Steel & Power Ltd. v. CCE, Raipur - 2004 (60) RLT 861 in support of the contention that since the duty is payable on the basis of installed capacity, the fact of part of the capacity not being worked out is not relevant. 5. As already noted, the appellant had informed the Central Excise Officers on 7-8-1997 and 1-9-1997 itself that two of the three furnaces were being closed. The letter dated 7-8-1997 specifically says that they have decided to close their 1 MT furnace "permanently". The letter dated 1st Sept., 1999 also stated that the closure of the two furnaces was "permanent". These letters make it clear that appellant was not seeking any rebate for short periods of cl....

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....ed machines. In the present case, the appellant had informed before the commencement of the compounded levy scheme itself that the two machines in question had been closed 'permanently'. Within a few months of that, it had also sought permission to dismantle the furnaces in question. Excise authorities were visiting the appellant's unit from the commencement of the compounded levy scheme itself and were noting that the two furnaces in question were not in production. Rules specifically permit change in production capacity and re-determination of duty amount based on such changed capacity. Duty liability is being fastened on the appellant merely because of inaction on the part of the Revenue authorities. This cannot be upheld. The decision o....