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Collector of Central Excise Vs. T.i. Cycles of India - Court Judgment

LegalCrystal Citation
CourtCustoms Excise and Service Tax Appellate Tribunal CESTAT Mumbai
Decided On
Reported in(1983)LC1341DTri(Mum.)bai
AppellantCollector of Central Excise
RespondentT.i. Cycles of India
Excerpt:
.....of duty paid on cycles exported outside the country as provided in rule 173pp of the central excise rules, 1944. the deputy collector of central excise has been authorised to file this appeal by the collector of central excise, bombay-i, as provided under sub-section (2) of section 35b. the main contentions advanced by the learned representative on behalf of the appellant is that the goods under claim for rebate were not exported directly from the factory of the manufacturer as provided under sub-rule (13) of rule 173pp. it has further been urged that the form for removal of goods for export namely ar 4a was not made out and addressed to the central excise officer, but this was made out long after the clearance of the goods from the factory and the ar 4a application was presented.....
Judgment:
1. This is an appeal filed under Section 35B of the Central Excises and Salt Act, 1944 by the Deputy Collector of Central Excise, Bombay-I, against the Order No. A-1477/B1-311/82 dated 25-10-1982 of the Collector of Central Excise (Appeals), Bombay, under which he has allowed the claim for rebate of duty paid on cycles exported outside the country as provided in Rule 173PP of the Central Excise Rules, 1944. The Deputy Collector of Central Excise has been authorised to file this appeal by the Collector of Central Excise, Bombay-I, as provided under Sub-section (2) of Section 35B. The main contentions advanced by the learned representative on behalf of the appellant is that the goods under claim for rebate were not exported directly from the factory of the manufacturer as provided under sub-rule (13) of Rule 173PP. It has further been urged that the form for removal of goods for export namely AR 4A was not made out and addressed to the Central Excise Officer, but this was made out long after the clearance of the goods from the factory and the AR 4A application was presented to the Customs directly and the same was endorsed for shipments by the Customs Officer. It has been contended on behalf of the appellant that this irregularity could not have been condoned by the Collector of Central Excise (Appeals), as the power for any such condonation under proviso of Rule 12 vests in the Collector who is the Collector of Central Excise, Bombay-I in the present case and not the Collector of Central Excise (Appeals). It has also been urged that no notification has been issued which would empower the Collector to condone the provisions of sub-rules (13) to (18) of Rule 173PP and Rule 185. It has therefore, been prayed that the order of the Collector of Central Excise (Appeals) be set aside and the original order of the Assistant Collector of Central Excise rejecting the respondents' claim for rebate be restored.

2. Shri K.C. Sekhar for the respondents has explained that the goods in question were especifically manufactured for export: This was mentioned in the relative gate passes under which the goods were cleared from the respondents' factory. At the time of clearance, the respondents were not knowing as to from which port the goods would be shipped and hence they could not prepare the AR 4A application and present the same to the Central Excise Officers. Later, the respondents decided to get the goods exported through Bombay and they made out the AR 4A application and submitted the same to the Customs Officer before the export of the cycles. The Customs Officer at Bombay had certified the shipment of the cycles under the relative AR 4A application. The proof of export had been submitted by the respondents to the Assistant Collector of Central Excise and they had claimed the rebate of duty due on the cycles.

However, the Assistant Collector rejected their claim and they approached the Collector of Central Excise (Appeals) to condone the procedural lapses as provided under Rule 12 of the Central Excise Rules. The Collector did so and allowed the appeal and granted the rebate due. Shri Sekhar therefore, pleaded that the Collector's order was correct and that the department's appeal should be dismissed.

3. We have examined the submissions of the appellants and the respondents. The principle argument taken up by the appellant is that the Collector for the purposes of Rule 12 is the Collector of Central Excise, Bombay-I as defined under Rule 2(ii) of the Central Excise Rules, 1944. Therefore, only the Collector of Central Excise, Bombay-I has the powers to condone the non-compliance with the rules in terms of the proviso to Rule 12 and that the order of the Collector of Central Excise (Appeals) condoning these irregularities is not in order. We find that this contention is not correct. While, the Collector for the purposes of Rule 12 has to be the Officer as defined in Rule 2(ii) of the Central Excise Rules, 1944, the powers of Collector under Rule 12 or any other Rule can be exercised by the Collector of Central Excise (Appeals) by virtue of the powers vested in him under Section 35A(3) of the Central Excises and Salt Act, 1944 under which he has got full powers to confirm, modify or annul the decision or order appealed against. There is therefore, no force in the appellants, arguments that the Collector of Central Excise (Appeals) has no powers to condone the irregularities in the Rule 12 of the Central Excise Rules, 1944 as he can do so under Section 35A(3). The other contention advanced by the appellant is that there has been lack of compliance with sub-rules (13) to (18) of Rule 173PP and Rule 185. It is seen that the lack of compliance of these provisions of law would be condoned under Rule 12 as the provisions of Rule 12 have been made applicable to the exports of excisable goods under Rule 173PP vide sub-rule (13) thereof.

Therefore, this argument of the appellant is also not sustainable. The only major contention advanced by the appellant is that the goods have not been removed for export direct from the factory of the assessee. We find that this requirement does not come within the discretion of condoning any lack of compliance under proviso to Rule 12 as this is a special provision incorporated under Rule 173PP. This is an additional requirement under sub-rule (13) of Rule 173PP and there are no provisions under Rule 12 or Rule 173PP under which the same can be dispensed with. In the present case, the goods have not been exported directly from the factory as required under Rule 173PP(13). In this view the claim for rebate would be normally inadmissible under the aforesaid provisions of law. However, taking all the facts into consideration, particularly that the goods under appeal were meant for export and they have actually been exported, the Collector of Central Excise (Appeals) appears to have taken these facts into account and allowed the appeal of M/s. T.I. Cycles Ltd. There is no imputation much less an allegation that the Collector has exercised the discretion in condoning the requirements in a colourable manner. The goods were meant for export and they have actually been exported. In the interest of promotion of exports, the Government have issued instructions to the Collectors to condone minor procedural lapses and the Collector seems to have exercised the discretion in accordance with the aforesaid instructions. Coming to the provisions of law, it is seen that proviso to Rule 12 gives the legal authority to the Collector to condone minor lapses. Since Rule 173PP has been enacted much subsequently and for a special purpose, it is legitimate to assume that the discretion vested in the Collector under Rule 12 would also apply to cases covered under Rule 173PP. In this view we find that the Collector's order is quite fair and equitous. We would loathe to set aside such a just order merely on the grounds of technicalities. In this view we find that we have no reasons to interfere with the order passed by the Collector of Central Excise (Appeals). Accordingly, we dismiss the appeal filed by the Deputy Collector of Central Excise, Bombay-I.4. We have also examined the arguments in the cross-objection filed by M/s. T.I. Cycles of India. The cross-objection is nothing but a reiteration in support of the order passed by the Collector of Central Excise (Appeals) and maintenance of the same. This is not the correct purpose in filing the cross-objection. The cross-objection is therefore not tenable and the same is dismissed accordingly.


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