TMI Blog2023 (5) TMI 330X X X X Extracts X X X X X X X X Extracts X X X X ..... st. Since the issue is squarely the same, there is found no justification to allow the appeal filed by the appellant, even though the same has been dismissed without consideration of the issue on merits for the reason that it was filed beyond the prescribed period for which the Commissioner (Appeals) could have condoned the delay. Appeal dismissed. - Excise Appeal No. 86463 of 2013 E/Cross 91213 of 2013 - FINAL ORDER NO. 85467/2023 - Dated:- 24-3-2023 - HON BLE MR. SANJIV SRIVASTAVA , MEMBER ( TECHNICAL ) HON BLE DR. SUVENDU KUMAR PATI , MEMBER ( JUDICIAL ) Shri Aditya Chitale , Advocate , for the Appellant Shri Deepak Bhilegaonkar , Additional Commissioner , Authorised Representative for the Respondent ORDER PER : SANJIV SRIVASTAVA This appeal is directed against Order-in-Appeal No. V3(A)433/M-III/2012-13/260 dated 31.01.2013 passed by the Commissioner of Central Excise (Appeals), Mumbai, Belapur, by which the Commissioner (Appeals) has held as follows:- 7. In the instant case, the appellants have submitted that they have received a copy of the impugned order on 14.09.2012. In terms of the statutory provisions as discussed above, the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e contract. For the reasons of time gap there is a price variation between the price quoted and the actual price at which the goods are supplied, namely for the reason of fluctuation in prices of raw materials/components viz. copper wire, bars, CRGO coils, transformer oil, etc. used in the manufacture of transformers during the final supply of the product. 2.2 For the reason that the appellant was unable to determine the prices finally at the time of the clearance of the goods from their factory premises. Assessments for the period April 2010 to March 2011 were made provisionally. 2.3 In order to protect the interest of transformer manufacturers, the Indian transformer manufacturers have formed an organization viz. Indian Electrical and Electronics Manufacturers Association (IEEMA). IEEMA adopted price variation clause to take care of the price variation in raw material component parts used in manufacture of power transformers and accordingly designed formula to work out the exact price variation in the contracted ex-works fixed for supply of power transformers. This formula has been accepted and incorporated in the consent letter between the buyer and the supplier. 2.4 Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s) as per the impugned order referred in para 1 above. 3.1 We have heard Shri Aditya Chitale, Advocate for the appellant and Shri Deepak Bhilegaonkar, Additional Commissioner, Authorised Representative for the Revenue. 3.2 Arguing for the appellant, learned counsel submits that:- Wide gap between tender submission and eventual manufacture/removal of broken down transformer: There was a wide gap between the date of filing of tender and the date of removal of broken down transformer/s and their installation as the manufacturing process of these huge transformers normally took 2-3 years from the initial date of successful tender / tender acceptance upto the date of removal of the transformer in broken down condition from the Appellant's factory. This is an accepted practice throughout the industry. Eventual price not known during tender document: The Appellant submits that due to the aforesaid wide gap, the eventual price of the transformers was not known to the Appellant when the Appellant used to fill in the tender document. Eventual price of components determined by JEEMA: IEEMA was a mutually accepted body between the buyers and the sellers who determined the ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Bench considered the issue and has answered the question as follows:- 47. Coming to Section 11AB, it came to be inserted by Act 33 of 1996. Thereafter, it was amended by Act 10 of 2000, Act 14 of 2001, Act 20 of 2002 and Act 49 of 2005. We have already extracted the relevant provisions of the said section. Section 11A must necessarily be read with Section 11AB. This is for the reason that interest under Section 11AB is premised upon the duty of excise not being levied or paid or short levied, short paid or erroneously refunded. Such duty is either determined under sub-section (2) of Section 11A or without such determination it being paid under Section 2B of Section 11A. In any of the circumstances, namely, non-levy, non-payment, short-levy and short-paid, any duty has been determined or paid as has been provided under Section 11A, necessarily the assessee becomes liable to pay interest from the first date of the month succeeding the month in which duty ought to have been paid. 48. The question which we are necessarily called upon to decide is when price is revised upward with retrospective effect and the excise duty on the same is paid immediately on a future date whet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome payable under the Act and the rules must be understood as the month in which the duty is payable under the Rules made under the Act. Thus, if goods are removed in the month of January ordinarily payment must be made by the 6th of February. If the duty is not paid by the 6th of February, Section 11AB must be understood as mulcting the assessee with liability to pay interest from the first day of March in the example we have given. If the assessee went in for provisional assessment under Rule 7, it becomes liable from the 1st day of the month following the month for which the amount is determined. 51. The expression the month in which the duty ought to have been paid under this Act, when it is read alongwith Rule 8, which declares that the duty on the goods removed from the factory or warehouse during a month is to be paid on the 6th day of the following month would mean that the Legislature has understood the expression the month in which the duty ought to have been paid under the Act in the same sense as it is declared in Rule 8. 52. In this regard it is also pertinent to notice the finding in the order of the original authority that perusal of the Circular dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 11A. 55. Rule 12 declares that every assessee is to file monthly returns. There is no provision in the rule which contemplates an assessment as such based on the return by the authorities. Assessment is self-assessment by the assessee under Rule (6). No doubt, in the case covered by Rule 7 there is a provisional assessment followed by a final assessment. The main ingredients for self-assessment would appear to be (1) the rate of duty (2) valuation (3) quantity of removal. 56. Are cases of non-levy, non-payment, short-levy and short payment mutually exclusive? In other words, can it be said that in a case of non-payment, it would not be a case of non-levy? Do they overlap? If there is non-levy, will there be short-levy at the same time. Finally, in a case of short-levy, can there also be short payment? 57. What is levy? We have already noticed that in the decision of this Court in N.B. Sanjana (supra), this Court rejected the argument of the Revenue that levy in Rule 10 means collection of some amount. The Court went on to hold that levy has not been used in the Act or the rules as meaning actual collection. 58. In a case where goods are removed clandes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... though the amount which is paid is in harmony with the amount which is assessed, it is not the amount which ought to have been paid by the assessee. The absence of full payment of duty or short payment has indeed also in one sense taken place. In a case where there is an escalation clause goods are cleared on a provisional price. Consequently, the value is provisional. There is a subsequent escalation with retrospective effect. It will affect the valuation which was employed in the self-assessment by the assessee which would necessarily be provisional. Enhancement of the value will date back to the dates of removal in view of the retrospective operation. Admittedly the liability for payment of differential duty has arisen. Upon the true value, in a case of retrospective escalation of price though later agreed being received and consequential differential duty being admittedly payable, it would result in Section 11A read with Section 11AB applying. 60. It is true that the statutory authority has found it to be a case of short payment. In the notice issued claiming interest it is stated there is short-levy (see page 89 Vol. II SLP paper book). Proceeding on the basis that it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h was originally occasioned and which is the subject matter of Section 11A(2)(b) and Section 11AB. 63. We are of the view that the reasoning of this Court in the order referring the cases to us (to this Bench) that for the purpose of Section 11AB, the expression ought to have been paid would mean the time when the price was agreed upon by the seller and the buyer does not square with our understanding of the clear words used in Section 11AB and as the rules proclaim otherwise and it provides for the duty to be paid for every removal of goods on or before the 6th day of the succeeding month. Interpreting the words in the manner contemplated by the Bench which referred the matter would result in doing violence to the provisions of the Act and the Rules which we have interpreted. We have already noted that when an assessee in similar circumstances resorts to provisional assessment upon a final determination of the value consequently, the duty and interest dates back to the month for which the duty is determined. Duty and interest is not paid with reference to the month in which final assessment is made. In fact, any other interpretation placed on Rule 8 would not only be opp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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