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2016 (7) TMI 1104 - AT - Central ExciseDeemed production of Gutkha - whether the deemed production of Gutkha, in respect of the period March, 2012, is to be determined on the basis of the number of operating packing machines in the factory of the appellant, or on the basis of the speed of the machines declared by the appellant? - Held that:- Rule 5 of the said Rules fixes the deemed quantity manufactured, by use of one packing machine, with retail sale price printed on the pouch. The above provisions read with the C.B.E.C. Circular dated 24.01.2004 makes the position clear that the relevant factor to be considered for determination of production, is the number of operating machines installed in the factory during the month and the retail sale price printed on the pouches and not on the basis of actual production. It is clear from the above Circular of C.B.E.C. that number of packing machines, operating during the month, is the only relevant factor which forms the basis for determination of deemed production and the duty liability, in terms of Rule 5 of the Capacity Determination Rules, 2008; and not any other factor such as, speed of the machines etc. The impugned orders, adopting the declared speed of the machines as the basis and consequently determination of the deemed quantity of production, are not correct and hence not sustainable under the law.
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