- (1.) This appeal under Section 35G of the Central Excise Act, 1944 is directed against the final order dated 13.08.2009 whereby the Customs, Excise and Service Tax Appellate Tribunal, New Delhi ['the Tribunal'] has dismissed the appeal [Excise Appeal No. 3308/2004 ? Ex(BR)] filed by the appellant-assessee against the order dated 31.03.2004/06.04.2004 as passed by the Commissioner, Central Excise, Jaipur-II ['the Commissioner'] insofar relating to the demand of duty and interest while affirming the finding that the appellant was not eligible to avail of the special procedure of Compound Levy Scheme under Notification No. 32/2001.
(2.) Briefly put, the relevant facts and the background aspects of the matter are that by way of Notification No. 16/2001, the Central Government introduced, with insertion of Section E-XA containing Rules 96-ZNA to 96-ZND in the Central Excise Rules, 1944, a special procedure [referred to as 'the Compound Levy Scheme'/'the Scheme'] for discharge of liability for Excise Duty leviable on production, by specified process, of the specified goods [referred to as 'the said goods'] by an 'independent processor of textile fabrics', on payment of the amount to be calculated per Rule 96-ZNC ibid. The appellant-assessee, Sulzer Processors Private Limited, Bhilwara made an application in the prescribed manner to the prescribed authority i.e., the Commissioner, Central Excise, Jaipur-II on 01.05.2001, seeking to avail of the said special procedure. While the application so made by the appellant was pending consideration, the aforesaid Rules of 1944 came to be rescinded but and however, the Central Government continued with the Compound Levy Scheme by issuing Notification No. 32/2001 dated 28.06.2001 under the Central Excise (No. 2) Rules, 2001. This Notification No. 32/2001, while retaining the basic features of the abovementioned Section E-XA provided, inter alia, the procedure for dealing with the pending applications too.
(3.) For their relevance and implications, apposite it shall be to take note, at this stage itself, of some of the provisions contained in the said Notification No. 32/2001, particularly the opening paragraph, and paragraph 7 and part of paragraph 8 as under: In exercise of the powers conferred by Rule 15 of the Central Excise (No. 2) Rules, 2001, (hereinafter referred to as "the said Rules") the Central Government, hereby, specifies the processed textile fabrics falling under heading Nos. 52.07, 52.08, 52.09, 54.06, 54.07, 55.11, 55.12, 55.13 or 55.14, or processed textile fabrics of cotton or man-made fibres, falling under heading Nos. or sub-heading Nos. 58.01, 58.02, 5806.10, 5806.40, 6001.12, 6001.22, 6001.92, 6002.20, 6002.30, 6002.43, or 6002.93 (hereinafter in this section referred to as the "said goods") of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), manufactured or produced by an independent textile processor exclusively with the aid of a hot-air stenter (hereinafter referred to as "independent textile processor"), and notifies the rate of excise duty as- (a) in the case of a processing factory whose average value of processed fabric is up to and including Rs. 30 per sq. mtr., Rs. 2.5 lakhs per chamber per stentor per month; and (b) in the case of a processing factory whose average value of processed fabric exceeds Rs. 30 per sq. mtr., Rs. 3 lakhs per chamber per stentor per month, installed in the processing factory, irrespective of whether such stentor or chamber is in use or not, or is in working condition or not. 2 to 6 7. (1) The independent textile processor, who is engaged exclusively in the manufacture or production of the said goods, shall make an application prior to the commencement of commercial production, in the form specified in the Appendix to this notification, to the Commissioner of Central Excise for the purpose of availing of the special procedure for payment of excise duty as contained in this notification. The Commissioner of Central Excise, on such application being made, shall grant permission, subject to such conditions and limitations as laid down in this notification, so as to cover the period commencing from the date of making the application and ending on the 31st March, 2002. Pending grant of such permission by the Commissioner of Central Excise, the independent textile processor may avail the provisions of this notification on a provisional basis. But if such application is rejected by the Commissioner of Central Excise, then the independent textile processor shall not be eligible to avail of the provisions of this notification from the date of making the application and shall discharge the duty liability as per the provisions contained elsewhere than in this notification and the duty, if any, paid under the provisions of this notification, shall be adjusted against the duty payable on such goods. Explanation I.- For the purposes of this notification, "independent textile processor" means a manufacturer who undertakes bleaching, dyeing or printing or any one or more of these processes with the aid of power or steam and who also has the facility in his factory (including plant and equipment) for carrying out heat setting or drying, with the aid of power or steam exclusively in a hot air stentor and who has no proprietory interest in any factory primarily and substantially engaged in the spinning of yarn or weaving or knitting of fabrics, on or after the 1st day of May, 2001. Explanation II.- For the removal of doubt, it is hereby declared that the provisions of this notification shall not apply to an independent processor who carries out heat setting or drying with the aid of an open-air stenter installed in his factory. (2) Notwithstanding anything contained in sub-paragraph (1), in respect of a processing factory existing as on 1st May, 2001, the application made by an independent textile processor, on or before the 20th May, 2001, to the Commissioner of Central Excise under Sub-rule (2) of Rule 96ZNA for availing the special provisions contained in section E-XA of the Central Excise Rules, 1944, for the period on and from 1st May, 2001 to 31st March, 2002, shall be deemed to be an application made under sub-paragraph (1). If such application had been granted by the Commissioner of Central Excise on a date prior to 1st day of July, 2001, the same shall be deemed to have been granted under sub-paragraph (1), subject to all the conditions and limitations as laid down in this notification. Otherwise, the Commissioner shall dispose of the application as if it is an application made under sub-paragraph (1). Explanation.- For the removal of doubts, it is hereby declared that a processing factory, of an independent textile processor, existing on 1st May, 2001 and in respect of which no application was made under Rule 96ZNA of the Central Excise Rules, 1944, on or before 20th May, 2001, shall not be eligible to avail of the benefit of this notification. Provided further that an application made prior to the commencement of commercial production by an independent textile processor, commencing production for the first time in a new processing factory coming into existence after the 1st May, 2001 but prior to 1st July, 2001, under the proviso to Sub-rule (2) of Rule 96ZNA of the Central Excise Rules, 1944, so as to cover the period up to the 31st March, 2002, shall also be deemed to be an application under sub-paragraph (1) and shall be disposed of under that sub-paragraph. If such application had been granted by the Commissioner of Central Excise under Rule 96ZNA of the Central Excise Rules, 1944, so as to cover the period up to 31st March, 2002, such disposal shall be deemed to be the disposal of the application under sub-paragraph (1), subject to all the conditions and limitations as laid down in this notification. 8. (1) The original value of the investment in the plant and machinery installed in the factory of the independent textile processor of the said goods, as on the 1st March, 2001 or on the 1st of May, 2001, whichever is higher, for a factory existing as on 1st May, 2001, of the independent textile processor or on the date of making the application under Rule 96ZNA of the Central Excise Rules, 1944 or paragraph 7 of this notification, as the case may be, in the case of an independent textile processor commencing production for the first time in a new factory coming into existence after the 1st of May, 2001, shall not exceed three crore rupees, irrespective of whether such plant and machinery is in use or not, or in working condition or not, and the independent textile processor shall declare the original value of investment in such plant and machinery installed in his factory, on the dates mentioned above, in the prescribed format duly certified by a Chartered Accountant or Cost Accountant. The Commissioner of Central Excise may require any such documentary evidence as he considers appropriate in respect of such original value before granting the application. (2) If any additional plant and machinery is installed by the independent textile processor at any point of time, he shall intimate the same to the Commissioner of Central Excise within seven days of such installation and the original value of investment in plant and machinery together with the original value of investment in such additional plant and machinery shall not exceed three crore rupees. Where such original value of investment exceeds the limit of three crore rupees, the provisions of this notification shall not apply from the first day of the month in which such investment exceeded the said limit of three crore rupees.;