Commissioner of Central Excise vs Sardar Steel Pvt. Ltd.

R.K. Abichandani, J.—All these matters raise identical points since they arise from an identical order of the Customs, Excise & Gold (Control) Appellate Tribunals, Mumbai made in a group of appeals on 30th August 2000. According to the applicant, the question of law arises as to the scope of Rules 3, 4 and 5 of the Hot-Re-Rolling Steel Mills Annual Capacity Determination Rules, 1997 in context of fixation of annual capacity of production.

The Tribunal disposed of the appeals by remanding the matter. In the process, it observed that the question involved in the appeals, as regarding the determination of the annual capacity of production of Excise Act read with the Notification No. 32/97, was no longer res integra, since the Tribunal had, in the earlier decisions in 1999 (112) ELT 719 and in Bellary Steel Rolling Mills v. CCE, Belgaum, reported in 2000 (39) RLT 701, held that the annual capacity was to be determined in terms of Rule 4 and not Rule 5, the impugned orders were, therefore, set aside and the matters were remanded to the lower authorities for re-consideration in terms of the said judgments.

In an identical application being CECG Application No. 41 of 2001, this Court (Coram : Hon''ble Mr. Justice B.C. Patel & Hon''ble Mr. Justice D.A. Mehta) made an order rejecting the application, inter alia, observing that, on going through the order of the Tribunal, no question of law can be said to be arising from it which required a reference to the High Court for its opinion.

The order of the Tribunal is merely an order of remand in-context of Rule 4, because, the annual capacity was required to be re-determined. The apprehension voiced on behalf of the applicant by the learned Standing Counsel that the remand order rules out the application of Rule 5 is not warranted in view of the fact that the Rule 5 only lays down that, in case the annual capacity determined by the formula under Rule 3(3) in respect of a mill, is less than the actual production of...... the mill during the financial year 1996-1997. Thus, Rule 5 raises a deeming fiction and is not a rule under which a determination is to be made of the annual capacity. While Rule 4 deals with pro rate calculation on the basis of annual capacity of production determined under Rule 3. Rule 4 envisages a situation where there is a change in the production pattern and the production is for a part of the year or where there is a change in the total Hot-Re-Rolling Mill capacity, in which event, the calculation pro rata is required to be done. It is in this context that the Tribunal has remanded the matter for reconsideration in light of the judgments referred to by it.

The remand for working out of an annual capacity in the above context does not raise any question of law and the determination of annual capacity would only be a question of fact to be determined by the concerned authority in accordance with the said Rules. Therefore, we are also of the view that the order of the Tribunal does not raise any question of law. All these applications are, therefore, summarily rejected.