Uniworth Textiles Ltd. vs Union of India and Another

Hon''ble Shri Satish K. Agnihotri, J.—Learned counsel appearing for the petitioner submits that the Commissioner of Central Excise (Appeals), while considering the case of the petitioner for exemption for pre- deposit in an appeal filed against the order dated 29.11.2006, passed by the Additional Commissioner, Central Excise, Raipur, has not considered the issue asto whether new and different facts and circumstances have arisen to take a different view from the view taken earlier by the Commissioner of Central Excise (Appeals) in the identical facts and circumstances, wherein, exemption from pre-deposit under the provisions of Section 35F of the Central Excise Act, 1944, was granted. Thus, learned counsel submits that in view of foregoing, the matter may be remanded back to the Commissioner of Central Excise (Appeals) to reconsider the issue and pass the detailed order, after having considered exemption granted earlier in the similar facts of the case.

Shri Maneesh Sharma, learned counsel appearing for the respondents submits that it may not make any difference, as the Commissioner of Central Excise (Appeals) has already considered each and every aspect of the matter.

It is pointed out by the learned counsel for the petitioner that the Supreme Court in several decisions has laid down that the earlier facts may also be considered while deciding the application for grant of exemption u/s 35F of the Central Excise Act, 1944. In support of his contention, the petitioner relies on the decision of the Supreme Court in Polar Industries Ltd. v. Commissioner of Central Excise, Meerut and Mehsana Dist. Co-op. Milk P.U. Ltd. v. Union of India.

Heard learned counsel appearing for the parties, perused the pleadings and documents on record. On perusal of the impugned order dated 31.05.2007, it is found that in Para 5, the Commissioner proceeded as under :

On a prima facie consideration of the merits of the case and the submissions made in the Appeal Petition, I have also perused the Order-In-Appeal No. 91/RPR-I/2006 dated 07.06.2006 passed by the Commissioner (Appeals-I), Central Excise Raipur referred to by the Appellant in the preceding para and on ascertaining further details, it has emerged that the aforesaid decision of Commissioner (Appeals) has been challenged by the Department vide an Appeal filed before the Hon''ble CESTAT, New Delhi on the basis of an Authorisation granted u/s 35-B(2) of the Central Excise Act, 1944 from Commissionerate of Central Excise file F.No. III(20)ARC/Commr1A''/48 / 2006 dated 03.08.2006

Thereafter, after quoting stand of the department, it has nowhere mentioned as what decision was taken by the CESTAT at New Delhi against the order in question. Even, thereafter, the petitioner has not recorded any further reasons for distinguishing the fact of the instant case, as contention of the petitioner, as recorded in the impugned order were as under :

3.9. In subsequent year of 1999-2000, however, such a situation did not arise for consideration and, therefore, the loss for the year ended 31.03.2000 sharply came down from 44.5 Crores to 4.18 Crores only. It would, thus, be seen that the huge loss of about Rs. 40 Crores or so accrued during 98-99 was made good by the Company by exporting it''s Finished Goods to that extent during subsequent year. The `Price Erosion'' system adopted by the Company for the year 1998-99 is an approved cannon of accounting system in company matters.

3.10. Be that as it may, the overall position is that there has been a continued loss of about Rs. 3 to 4 Crores every year to the company during the 4 preceding financial years. It is most humbly and respectfully further submitted that even during the current financial year 2006-2007 the Company is not likely to make any profit

In view of foregoing, the impugned order dated 31.05.2007 (Annexure P-2) is set aside and the matter is remitted back to the Commissioner of Central Excise (Appeals) to reconsider the case on the facts of the case and on hearing both the parties, pass the order, in accordance with law, on its own merit.

Accordingly, the writ petition is allowed to the above extent.