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2014 (11) TMI 77 - CESTAT AHMEDABADRecovery of amount collected u/s 11D - amount collected from customers despite availing benefit of exemption (Set off) notification Notification No. 432/86-CE dated 06.08.1986 - whether or not set-off claimed by the appellant as per Notification No. 432/86-CE dated 06.08.1986 is a duty assessed and paid on the gate passes - Held that:- notification is issued under Rule 8(1) of the Central Excise Rules, 1944 and exempts certain final products to an extent equivalent to duty of excise already paid on the input Naphthalene. There is no indication that duty paid on Naphthalene is eligible as credit and this notification is also does not prescribe any register to be maintained by the manufacturers of the finished goods for availing any credit. However, there is definitely an indication that duty equivalent to the duty paid on inputs (Naphthalene) is required to be set-off while arriving at the duty payable on the finished goods. As there is one-to-one correlation with respect to inputs used, duty paid on such inputs and the extent of exemption, therefore, this has to be considered only an exemption notification in which the extent of exemption is determined by the duty paid on the inputs. The extent of set-off available shows that there is no payment of duty and the same is not required to be paid on the finished products manufactured by the appellant. Demand period is April 1990 to April 1992 and the show cause notice has been issued on 01.11.1993 therefore, the same is issued within reasonable period. So far as addition of the excess amount in the invoices from the customers in the guise of duty paid as set-off it is also observed that the fact of set-off being recovered from the customers was not brought to the notice of the Revenue and accordingly, show cause notice has to be considered as issued in reasonable time as held by the Hon'ble High Court in the case of Inductotherm (I) Pvt. Limited (2012 (12) TMI 856 - GUJARAT HIGH COURT). Further the additional consideration so received/ recovered has to be included in the assessable value under Section 4 of the Central Excise Act, 1944 - Decided against assessee.
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