1. The facts giving rise to this appeal arc that the appellants manufacture corrugated board out of duty paid kraft paper purchased by them from the market. Duty on corrugated board manufactured by the appellants prior to 24.1.1978 was 5% ad valorem under Notification No.46/71-CE dated 24.4.1971 as amended. On 24.1.1978 the effective rate of duty on Kraft paper including kraft liner or corrugated medium of a substance equal to or exceeding 65 grams was raised from 30% to 371/2% ad valorem by Notification No. 15/78-CE dated 24.1.1978 and Notification No. 46/71-CE was amended by Notification No. 14/78-CE dated 24.1.1978 according to which corrugated board was exempted from the whole of duty if it was proved to the satisfaction of the proper officer that the corrugated board of the type known as kraft liner or corrugated medium of a substance equal to or exceeding 65 grams per square metre and where the duty has been paid at the rate of 37% ad valorem.
2. As per the allegations made by the appellants, during the month of December, 1977 to March, 1978, the appellants had paid duty at 5% ad valorem on corrugated board and not claimed full exemption but the Superintendent Central Excise asked the appellants vide his letters dated 24.4.1978 and 25.4.1978 to produce gate passes as evidence of payment of duty on paper/corrugated board received by the appellants.
Though the appellants informed the Superintendent that there was no practice of obtaining gate passes showing an evidence of payment of duty or paper when the paper was purchased from the market even then the Superintendent raised a demand of duty at 30% ad valorem on the clearance of paper/during the period December, 1977 to March, 1978 by making remarks on RT-12 Returns. The Assistant Collector without applying his mind confirmed the demands by passing a non-speaking order. The Collector (Appeals), as per the allegation of the appellants, also failed to apply his mind judiciously and dismissed the appeal of the appellants without going into the merits of the case.
3. Aggrieved by the said order of the Collector (Appeals), the appellants filed this appeal before this Tribunal.
4. We have heard Shri D.N. Kohli, Consultant for the appellants and Mrs. Vijay Zutshi, S.D.R. for the department and gone through the record.
5. Shri Kohli, the learned consultant of the appellants, drew our attention towards the orders passed by the Collector (Appeals). This order shows that the Collector (Appeals) did not apply his mind to the submissions made by the appellants before him. He adopted a short-cut method of dismissing the appeal only on the ground that no appeal as such has been made against the demands and it has been as a matter of fact filed against the letter sent by the Assistant Collector, which is neither an order nor a decision. Shri Kohli, submitted that neither the Assistant Collector nor the Collector (Appeals) applied their minds in deciding the matter on merits.
6. When the Superintendent raised a demand against the appellants and the appellants filed a representation before the concerned Assistant Collector, it was the duty of the Assistant Collector to pass a &peaking order] rejecting or accepting the representation made by the appellants before him. Instead of passing a judicious and speaking order, he only sent a letter to the' appellants informing them that the assessment has been made under Rule 173-1 of the Central Excise Rules 1944, so they can appeal to the Appellate Collector of Central Excise, New Delhi, against these demands if they so choose. This letter of the Assistant Collector clearly shows that he did not apply his mind to the representation made by the appellants and simply showed them the way to approach the Appellate Collector of Central Excise, New Delhi. To our dismay even the Collector (Appeals) before whom the appellants filed the appeals did not apply his mind and dismissed the appeal only saying that the appeal before him was not against the demands but against the letter sent by the Assistant Collector and as such the same was not maintainable.
7. From all this, it appears that the appellants were made to run from pillar to post but without any relief.
8. Under these circumstances, we remand the case back to the Assistant Collector concerned with a direction that he should decide the matter on merits after giving an opportunity of hearing. He should decide the matter as early as possible but not beyond the period of four months from the date of receipt of this order.