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Central Excise - Case Laws
Showing 101 to 120 of 268 Records
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2014 (2) TMI 725 - SUPREME COURT
Denial of refund claim - unjust enrichment - Refund of the excess differential amount - Whether the respondent assessee has indeed recovered the excess amount from the consumers - Held that:- there was no question of assessee having recovered the excess amount from the consumers. This is so because, the assessee throughout asserted, that so far as Tyre Cord Fabrics are concerned, the duty payable was under Heading No.59.02 of the classification effective from 01.08.1986 whereunder only basic excise duty was payable. In view of the above, it is obvious that the assessee did not recover any duty from the consumers under Heading No.59.09 at least till the show cause notice was issued on 25.02.1993. Accordingly, whatever amount was recovered from the assessee by the appellants, could not have been been required to be refunded to the consumers - Following decision in ommissioner of Central Excise, Hyderabad vs I.T.C.Ltd. [2004 (12) TMI 90 - SUPREME COURT OF INDIA] - Decided against Revenue.
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2014 (2) TMI 724 - CESTAT NEW DELHI
Removal of Inputs as such - reversal of cenvat credit under Rule 3(5) - Recovery of service tax - Held that:- Rule 3(5) of Cenvat credit Rules, 2004 not indicates for payment of equal amount in respect of credit on input service - Well settled that while interpreting statute no addition or subtraction can be made and words therein be given their plain meaning- No provision for payment of credit on input service- Reversal of credit in respect of GTA service not justified - no reasons to interfere in the impugned order of Commissioner (Appeals) - Following decision of Bansal Alloys & Metals vs. CCE [2009 (9) TMI 514 - CESTAT, NEW DELHI] - Decided against Revenue.
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2014 (2) TMI 723 - CESTAT MUMBAI
Cenvat credit - Job Work - Tools and tips not received back as such from the Job Worker within 180 - Capital Goods - Commissioner allowed credit - Held that:- In the show-cause notice (itself) these tools and tips has been held as 'capital gods'. Therefore, the revenue cannot be said, at this stage, that these tools and tips are not capital goods. As these tools and tips are capital goods and there is no bar under the Central Excise Acts or Rules that the capital goods cannot be sent to the job-worker. Therefore, the capital goods used in the factory of the job-worker are entitled for credit to the respondent. Although the capital goods could not be returned "as such" after the usage, in that circumstances also the credit cannot be denied. Further, there is no bar on the respondent to take away 50% of the CENVAT credit in the year of procurement of the capital goods and the remaining 50% in the subsequent year although they were in the possession of the job-workers. There is no bar in taking 50% of the CENVAT credit in the subsequent year as they are components of the capital goods and are covered under Rule 4(2)(b) of CENVAT Credit Rules, 2004 - Decided against Revenue.
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2014 (2) TMI 722 - CESTAT NEW DELHI
Availability of Cenvat credit of duty paid - Credit claimed on capital goods - Whether duty paid on welding electrodes are used in the factory of appellant for repair and maintenance of plant and machinery is eligible for Cenvat credit - Held that:- Cenvat credit can be availed on welding electrodes which are used for maintenance of plant and machinery - impugned order is accordingly set aside and appeal allowed with consequential relief - Decided in favour of assessee.
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2014 (2) TMI 721 - CESTAT MUMBAI
Denial of CENVAT Credit - Cenvat Credit denied on the ground that the activity of cutting and slitting did not amount to manufacture - Commissioner dropped the demand holding that the activity of cutting and slitting amounts to manufacture and therefore the appellant is rightly eligible for the Cenvat Credit taken - Held that:- In view of Notification NO. 24/2002-CE dated 19/04/2012, the respondent herein is not required to reverse the Cenvat Credit taken of the excise duty or CVD paid on the materials procured by them for undertaking the job-work on which they have discharged excise duty liability. The demand is also for the period up to 15/03/2012. Thus, the appellant has satisfied the conditions “(a) & (b)” specified in the said Notification. As regards the condition (c), the Ld. Counsel for the respondent submits that the appellant has not made any refund claim. Subject to verification of this claim by the department, the benefit of Notification No. 24/2012-CE is available to the appellant. Consequently, the question of demanding duty amounting to Rs. 1,54,33,170/- would not arise at all - Decided against Revenue.
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2014 (2) TMI 720 - CESTAT NEW DELHI
Manufacture - Labeling of imported good - Whether activities such as affixing of warranty stickers and chassis number stickers of the fully finished imported already branded VCD/DVD/Multi players of Heading 85.21 amounts to manufacture or not in terms of Section 2 (f) (iii) of the Central Excise Act, 1944 - Invocation of extended period - Held that:- Only requirement of making these goods as manufactured in terms of section 2f(ii) is that labeling of containers amounts to manufacture but in the case of appellants labeling / branding is already done at the time of import and sticker of MRP are also affixed at that time. It is further noticed that it is not the case of the department that the appellants are packing or repacking. We have also examined that it is not the case of the department that the import of the goods were in bulk and the same had been put in some containers. We have also examined the aspect of 'that any other treatment' and find that has to be something as defined in section 2f. Once the goods at the time of clearance at the Customs department have undergone requirement of goods manufactured with MRP price having been affixed and goods having been duly cleared by the customs, there is no cause for asking duty on the same product merely because sticker of warranty and the chassis number have been pasted on these containers - Decided in favour of assessee.
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2014 (2) TMI 719 - CESTAT NEW DELHI
Duty demand - Clandestine removal based on evidence produced by the Revenue - Held that:- steel units engaged in the manufacture of MS ingots are using electricity as one of major raw materials which is controlled by the Electricity Board situated in their respective jurisdiction. Accounting of electricity is very proper and main indicator of production of steel ingots. Normal electricity consumption for production one MT of M.S. ingot usually ranges between 700 to 870 units. Details in para 6 supra indicate the fact. We have noticed wide variation of consumption of electricity showing consumption of unit ranges 773 to 1752. For a unit to be economically viable, it is understood that each manufacturer will take abundant precaution that no loss of power due to wide fluctuation in consumption occurs otherwise cost of finished goods becomes so high that there are losses. Continued higher consumption in almost all the months (sample details in para 3) is clear indicative of motive of the appellants to suppress the production.
Tribunal has taken into account all the factors which prima facie points out towards suppression of production. It is also observed that when department has discharged initial burden of proof showing excess consumption of electricity later the appellant have no valid explanation to justify the excess consumption of electricity. Mere fluctuation in the electricity supply or the quantity of raw materials etc. are not reasons will make such large variation of consumption of electricity. The appellants pleading that there is no evidence of unaccounted procurement of raw materials and unaccounted sale of finished goods, transportation of these goods are not sustainable because the person, who indulged in the clandestine removal of goods, he will not keep the records thereof.
Revenue has prima facie proved preponderance of probability is in their favour and it is a fit case where some pre-deposit has to be ordered for hearing their appeals. Accordingly, we order that pre-deposit of Rs.1.50 crore will be made by the appellants within twelve weeks from today as a condition to hear their appeals. Subject to above deposit, pre-deposit of balance amount of dues and entire amount of penalty imposed on both appellants shall stand waived and its recovery stayed during pendency of the appeals - Conditional stay granted.
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2014 (2) TMI 718 - CESTAT NEW DELHI
Determination of excess stock - Confiscation of the excess stock with option to be redeemed on payment of redemption fine - Penalty under Rule 25 of Central Excise Rules on each of the appellant company as well as its Director/ Manager - Held that:- excess stock in Shivangi Estates Ltd.’s case is 25% as against the RG-1 Register balance 54.285 MT, the stock determined average basis was found to be 68.118 MT. Excess to the extent of 25%, in my prima facie view, is not possible on account of determination the weight on average basis. Therefore, in this case M/s. Shivangi Estates Ltd., prima facie that there was excess un-accounted stock and hence confiscation of the excess stock and imposition of penalty of this amount appears to be justified.
In other three cases the alleged excess is less than 5% and in my prima facie view variation between the actual weight and the weight ascertained on average basis to this extent is possible. Therefore in these cases, the allegation of non-accounted of finished goods does not appear to be sustainable.
Conditional stay granted.
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2014 (2) TMI 717 - CESTAT NEW DELHI
Valuation - inclusion of Cash discount - the assessable value shown in the Central Excise invoice was 4% less than the assessable value shown in the commercial invoices for the same goods - Held that:- full amount of value including 4% discount was charged from the buyer in the commercial invoices. During hearing they could not satisfy that in such situation where full value has been realized by them by way of commercial invoice and later records have been scored out by getting debit notes issued and resultantly paying no duty on the same. No reconciliation relating to differential value found in the trial balance including the value of the availed cash discount could not be proved by any evidence.
It is explicitly clear that invoices issued under Rule 11 do not indicate the value of offered/availed cash discounts and where the cash discount has been availed of by the buyers, the value of a availed cash discount cannot form the part of the value of commercial invoices, issued simultaneously for the purpose of computation of value of total sales. Hence, the question of inclusion of value of availed cash discount in the differential value found in the trial balance does not arise. - Valuation provisions are very clear that cash discount is admissible discount if it fulfils the policy requirement of the company and uniformly given to all the buyers. However, lack of any evidence in their favour, we find the preponderance of probability is in favour of the Revenue - Conditional stay granted.
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2014 (2) TMI 716 - CESTAT NEW DELHI
Rectification of mistake - High Court of Chhattisgarh directed Tribunal to decide the case of the appellant keeping in view the law laid down by Apex Court in the case of CCE, Chandigarh vs. Doaba Steel Rolling Mills reported in [2011 (7) TMI 10 - SUPREME COURT OF INDIA] - appellant submits that the ratio of Doaba Steel Rolling Mills case is not applicable to the appellant s case - Held that:- Court cannot be faulted when both sides fail to bring the material fact and evidence not considered in the course of hearing to give rise to the error in law. It is settled law that an order passed by a court or Tribunal is conclusive in so far as the facts and conclusion recorded therein. The mistake in the order sought to be rectified is not specifically brought to scrutiny showing that such mistake is apparent from record and is a rectifiable mistake - Had there been any fact recorded and law was not rightly applied there to reach to a conclusion, that could have been appreciated to be a case of rectifiable mistake. But that is not the case here. Further, Tribunal has no power of review in absence of statutory provision in that regard.
Appellant was well aware that Tribunal has no power of review. But it opted to withdraw its appeal before Hon’ble High Court to seek review remedy before Tribunal. On the facts and in the circumstances it is difficult to agree that Tribunal committed any error of law when no rectifiable mistake is apparent from the face of the record. It is accordingly difficult for us to act as a review court which is not the mandate of the statute for which it has become impracticable to redress the grievance of the appellant - Decided against assessee.
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2014 (2) TMI 699 - CESTAT NEW DELHI
Assessment in terms of provisions of Rule 8 of Central Excise Valuation Rules - Imposition of penalty - Held that:- lower authorities have advanced their case on wrong premises that repair of damaged and defective motors amount to manufacture. Admittedly provisions of Rule 8 are applicable in respect of captively consumed goods and cannot be held to be invocable in case of clearances of repaired items. Though the said issue does not need the support of any precedent decision but we may refer to Tribunal’s decision in the case of CCE, Indore v. Hotline CPT Ltd. [2009 (9) TMI 854 - CESTAT NEW DELHI] observing that the process of repair does not amount to manufacture. If that be so, the provisions of Rule 8 are not applicable - Decided in favour of assessee.
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2014 (2) TMI 698 - CESTAT AHMEDABAD
Waiver of pre-deposit - Cenvat Credit - According to Revenue, no duty was payable but the supplier has paid the duty - the product Zinc Dross, Flux Skimming and Zinc Scaling - Held that:- The rules entitled the recipient manufacturer to avail of the benefit of the duty paid by the supplier manufacturer. - Following decision of MDS Switchgear Ltd. Vs. CCE Aurangabad [2001 (4) TMI 130 - CEGAT, MUMBAI] and upheld by Apex Court in [2008 (8) TMI 37 - SUPREME COURT] Decided in favour of assessee.
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2014 (2) TMI 697 - CESTAT MUMBAI
Valuation of goods - interconnected undertakings but not related - Revenue held that prices at which the appellant had sold the goods to independent buyers should be taken as the basis in terms of the rule 4 of the valuation Rules, 2000 - Held that:- Though the appellant and the buyer are interconnected undertakings as defined in Section 2(g) of the MRTP Act and hence, related in terms of the provisions of Section 4 (3)(b), they are not related as defined in the Companies Act. Therefore, in terms of Rule 10 of the Central Excise Valuation Rules, 2000 as the appellant is not related to the buyer as defined in the sub-clause (ii) (iii) & (iv) of the sub-rule (3) of Section 4, valuation has to be done by treating both the parties as if they are not related persons for the purposes of sub-section (1) of Section 4. No evidence has been adduced by the revenue to show these two firms are related as provided for in the Companies Act or they have mutuality in the business of each other. As regards the application of Rule 4 to the transactions, the said Rule envisages making of adjustments on account of difference in the dates of delivery of such goods and of the excisable goods under assessment as may appear reasonable.
There is a variation in the dates of delivery but also the quantities lifted by JSW Steel are substantial and regular when compared to the quantities sold to other independent buyers. In these circumstances, there is merit in the contention of the appellant that the discount of about 2% in the prices when compared to those sold to independent buyers cannot be considered as unreasonable. This factor has not been considered by the adjudicating authority. Therefore, we are of the considered view that the matter has to go back to the adjudicating authority for fresh consideration - Decided in favour of assessee.
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2014 (2) TMI 696 - CESTAT AHMEDABAD
Waiver of the pre-deposit - Availment of cenvat credit of CVD, Education Cess, S.H.E. Cess and additional duty paid - Lower authorities have held that appellant herein having exported the pipes and got the same calibrated from the units situated abroad cannot avail cenvat credit the duty of customs paid on importation therefore, credit of duty paid cannot be availed by the appellant as the process of calibration carried out on the pipes by the units situated does not amount to manufacture - Held that:- appellant herein undisputedly discharged appropriate customs duty, CVD, and additional duty on the pipes imported by them. It is also not disputed that the appellant utilized/used these calibrated pipes for further manufacturing of their final products and paid proper duty on such final products. It is also not disputed that the appellant had filed bills of entry, when the calibrated pipes were imported and the customs authorities have assessed the bills of entry. On the face of such a factual matrix both the lower authorities have over looked the legal provision inasmuch as duty paid as CVD is eligible to be availed as cenvat credit; if an assessee is able to show that the inputs/capital goods were utilised/used, directly or indirectly in the manufacture of final products on discharge of appropriate duty. That the appellant had utilized/used the calibrated pipes in the manufacture of their final products being undisputed, in our view, the lower authorities have erred in denying the cenvat credit of duty paid as CVD, Education Cess, S.H.E. Cess and additional of customs - Decided in favour of assessee.
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2014 (2) TMI 695 - CESTAT NEW DELHI (LB)
Penalty u/s 11AC - Demand on the basis of shortages of raw material and the hypothetical calculations of production of final product and clandestine clearances of the same - Held that:- Investigation team did not find any stock during investigation. Inextricable link of clandestine removal of finished goods was established from incriminating documents and evidence including private recorded found in the course of investigation. Unaccounted sale was admitted by buyer. Shortage of scrap of 175.608 MT of scrap, 3.92 M.T. of Ferro Manganese and 50 Kg. of Ferro silicon was well evident from statement of Shri P.S. Gehlot. These goods were used in manufacture of steel castings on the basis of clear admission of assessee. Evasion of duty of ₹ 6,65,309/- was established. Therefore, nothing was presumed nor assumed by investigation when that remained un-rebutted in adjudication. Accordingly decision of the learned technical member cannot be said to have been based on no evidence or inadequate evidence - impugned order of Commissioner (Appeals) is set aside and Revenue's appeal is allowed by restoring the order of original adjudicating authority - Decided in favour of Revenue.
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2014 (2) TMI 693 - CESTAT NEW DELHI
Availment of CENVAT Credit - Use of steel items for fabrication of tanks - Revenue held that appellant would not be eligible availing credit on steel items as the same appear to have been used in erection of permanent supporting structure used mainly for making the machinery of vibration fee - Held that:- The appellant s claim is that they are eligible for Cenvat Credit in respect of steel items, in question, as the same have been used by them for fabrication on capital goods/parts of capital goods namely tanks and accordingly the steel items would have to be treated as inputs used in the manufacture of capital goods and would be eligible for Cenvat Credit. It is also seen that para 2 of the Show Cause Notice itself states that on scrutiny of the said returns filed by the appellant, it was revealed that they have taken Cenvat Credit on the structural steel items like Angle, Channel, Beam used by them in manufacturer of parts of capital goods and that Cenvat Credit was availed appears to be inadmissible.
Since in this case the availment of Cenvat Credit in respect of Steel items, in question, and their use has been declared for ER-1 Return, it was the responsibility of Jurisdictional Assistant Officer to immediate verify their claim and as such it cannot be said that the appellant did not disclose the availment of Cenvat Credit in respect of the inputs in question of their use. Therefore, the appellant have strong prima facie in their favour on limitation and hence the requirement of pre-deposit Cenvat Credit demand, interest thereon and penalty is waived for hearing of the appeal and recovery thereof is stayed - Stay granted.
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2014 (2) TMI 692 - CESTAT AHMEDABAD
Demand of differential Central Excise duty, interest thereof and imposition of penalty - Held that:- appellant herein, on being pointed out by the Audit party, has paid the differential Central Excise duty worked out by the Audit party along with interest on 24.03.2010. It is also noticed from the records that the appellant has paid 25% of the amount of duty as penalty on 19.04.2010. In my view, having discharged the entire duty liability, interest thereof and 25% of the amount of duty as penalty, the issue should have been closed by the authorities as per the provisions of Section 11A (2B) of Central Excise Act, 1944. It is also noticed from the adjudication order that the adjudicating authority has, while adjudicating the issue, done the very same - Appellant, having discharged differential Central Excise duty, interest thereof and also 25% of the amount of duty liability, as pointed out by the Audit party, before the issuance of show cause notice, has to be construed as conclusion of the proceeding, if any, initiated against him - Decided in favour of assesssee.
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2014 (2) TMI 691 - CESTAT MUMBAI
Finalization of provisional adjustment - adjustment of excess payment with short payment - Held that:- any excess payments made can be adjusted towards short-payments at the time of finalizing of the provisional assessments. The finalization of the assessments has been done vide Order-in-Original No. 14/1995, dated 24-6-1995. Therefore, the adjudicating authority has correctly adjusted the excess payments made by the assessee towards the short-payments which were due from them - This provision has been incorporated in the statute vide Notification No. 45/99-C.E., dated 25-6-1999. Therefore, prior to 25-6-1999 the adjudicating authority could adjust the excess payments made at the time of provisional assessment towards short-payments arising at the time of final assessment - Decided against Revenue.
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2014 (2) TMI 690 - CESTAT NEW DELHI
Assessable value of goods - Duty liability on processed fabrics at the price at which M/s Suzuki Textiles sells the goods in the market - Assessee contends that M/s PGO Processors and M/s Suzuki Textiles are independent units - Demand has been confirmed by the Commissioner taking the sale price of M/s Suzuki Textiles as assessable value - whether Suzuki Processors was the real manufacturer of the output manufactured by PGO processor - Held that:- While prima facie case is one of the consideration, irreparable injury that may be caused by an interim order is a vital consideration. So also balance of convenience cannot be brushed aside to consider interim prayer. No doubt, pre-deposit is rule and waiver thereof is an exception. Interest of Revenue weighs equal importance while undue hardship is considerable - Show-cause notice does not throw light on any allegation on the proprietary interest of Suzuki Processors on PGO Processors Pvt. Ltd. and manner of control over its affairs including influence if any on valuation of goods cleared to Suzuki Processors. Admittedly revocation of registration was done in 2012 and show cause notice was also issued two years before to the impugned period expired.
Prima facie, it appears that the matter in controversy warrant extensive examination from various angles testing evidence rigorously. When PGO Processors is stated to have paid duty on the goods cleared valuation issue depends on several factors including the terms of the aforesaid notifications to be tested by an elaborate hearing. Prima facie , appreciating whim and caprice are alien to justice, and noticing that balance of convenience tilts in favour of the assessee, dispensation of pre-deposit till disposal of appeal would serve interest of justice - Stay granted.
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2014 (2) TMI 689 - CESTAT AHMEDABAD
Reversal of cenvat credit more than the credit availed on removal of inputs as such - Waiver of pre-deposit - The Hon’ble High Court has reversed the decision of the Tribunal and held that the appellant cannot pay excess amount on the inputs as duty and holding so, they directed the appellant to pay the entire amount paid in excess through PLA and also upheld the penalties imposed under Rule 15 of the Cenvat Credit Rules, 2004. - Held that:- appellant to deposit an amount of Rs.1,68,99,531/- in cash - stay denied.
Regarding penalty under Rule 25 - Held that:- prima facie, the penalty imposed by the adjudicating authority under the provisions of Rule 25(1)(a) of the Central Excise Rules, 2002 may not arise, as the said provisions would indicate that the penalty under Rule 25(1)(a) can be imposed only if the manufacturer removes any excisable goods in contravention of any of the provisions of this rule. It is on record that the appellant had discharged the Central Excise duty on the inputs removed as such and that too more than the actual duty. Hence, the provisions of Rule 25(1)(a) of Central Excise Rules do not prima facie get attracted. - Stay granted towards penalty.
Regarding penalty under Rule 15 - Held that:- the said issue was not argued before the Hon’ble High Court and framed as question of law and we find that during the relevant period in this case i.e. July, 2006 to June, 2008, the period during which the appellant discharged the duty on the inputs cleared by them through CENVAT account, they had an order of the Tribunal in their favour and the provisions of Rule 15(1) reproduced herein above may not prima facie indicate that the appellant needs to be penalized for such contravention. - Stay granted towards penalty.
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