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Central Excise - Case Laws
Showing 1 to 20 of 196 Records
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2014 (6) TMI 1072
Process amounting to manufacture or not - what prompted the petitioner to surrender its registration as a dealer and switches over to apply for a registration as manufacturer? - suppression of facts or not.
It is tried to be contended that since the identity of the manufacturer of the product is disclosed in the prescribed form, the dealer losses the future business because of the direct contact with the manufacturer.
HELD THAT:- If the petitioner stood firm on its contention that it does not amount to manufacturing activities, the conduct of surrendering the registration as a dealer and obtaining a fresh registration as manufacturer amounts to suppression of facts and percolating false statements to the statutory authority. If the petitioner's stand appears to be correct, the process which was undertaken amounts to manufacturing of new product for which the registration was subsequently obtained then it leaves no ambiguity in arriving at the inference that the process undertaken by the petitioner amounts to manufacture and the excise duty applicable to such activities are attracted. It leaves no room for doubt in my mind that the petitioner is prevaricating his stand which suits him to wriggle out from the provisions, which affects adversely.
Had it been a case that the authority have raised a doubt and disputes over the process of dealing the material purchased by the petitioner, the proposition of law tired to be canvassed before this Court does not admit any quarrel. But in the instant case, the petitioner voluntarily approached the authority and surrendered his registration as a dealer and opted the registration as a manufacturer meaning thereby the petitioner itself treated the process to be a process of manufacture and, therefore, the authority has proceeded on the basis of the stand taken by the petitioner and issued the show-cause notice treating the transactions entered into during the relevant period when the petitioner held the registration as a dealer as manufacturing activities.
It is not in dispute that the so called final product sold by the petitioner in the market is well-known as such and there is no dispute as was raised in the noted report involved in the instant case. The ratio which could be culled out therefrom is that the excise duty is payable on the final product known in the market which in my opinion is no longer res integra.
The suppression signifies a conscious and deliberate act with an intention to gain something. Mere omission and failure to disclose cannot be brought within the expression ‘suppression of fact’. In the instant case, the petitioner made transaction of the caveatable inputs and passing of the ‘CENVAT’ credits and did not disclose the identity as manufacture. Such disclosure came voluntarily after March 2009 when the petitioner applied for registration as manufacturer after surrendering the registration as dealer. The intention to gain by such suppression is manifest and, therefore, the authorities did not commit any infirmity and/or illegality applying the extended period as enshrined under Section 11A(4) of the Central Excise Act, 1944.
Considering the conduct of the petitioner as shown before the authorities and the act by which the factum of manufacturing activities was suppressed during the period when the petitioner was having the dealer registration, this Court feels that the petitioner should be saddled with the costs to be paid to the department - the writ-petition is dismissed with exemplary costs assessed at Rs. 50,000/- to be paid within a week from date.
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2014 (6) TMI 1061
Seeking grant of Bail - evasion of huge Central Excise - allegation is that petitioner has not got himself registered under the Central Excise Act and got registered after search was conducted - HELD THAT:- Taxes play vital role in the development of a country and are needed not only for infrastructural purposes but also social medical and other needs of a country. Tax dodgers and evaders are certainly required to be dealt with heavy hands and need no sympathy and Revenue departments are well within their rights to nab tax dodgers and evaders of taxes. This Court do not support tax evaders and tax dodgers. Further, in such cases, where tax evasionis prima-facie of very high value, the question of bail should be considered seriously and it should not be granted as a matter of course. Tax evasion of high value certainly jeopardizes the entire economy of the country and is an economic crime of serious magnitude.
It is also to be noticed that evasion of taxes whether Income Tax, Central Excise, Service Tax or any other taxes all come in the category of economic offences and the recent trend of decisions in the matter of bail, in this country, has been to deal with economic offences seriously but prima-facie in this case since the principal amount of Central Excise stands deposited and admitted to have been received by the respondents before approaching this Court therefore, without expressing any opinion on merits/demerits of the case, the accused-petitioner deserves to be enlarged on bail under Section 439 Cr.P.C.
This bail application is allowed and it is directed that the accused petitioner Suresh Sharma S/O Shri Geegraj Jangid be released on bail under Section 439 Cr.P.C., subject to conditions imposed.
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2014 (6) TMI 1053
Waiver of predeposit and stay - the tribunal has not assigned any reasons except referring to some judicial pronouncements - HELD THAT:- Reliance is placed upon an order passed by the Division Bench of this Court in COMMISSIONER OF CENTRAL EXCISE, THANE-I VERSUS JSW STEEL LTD. [2014 (9) TMI 332 - BOMBAY HIGH COURT] where it was held that we have no alternative but to allow this Appeal only on this short, but substantial question of law and that is that the Appeals cannot be disposed merely by recording rival submissions and not discussing them elaborately but, in a perfunctory manner.
Appeal allowed.
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2014 (6) TMI 1035
Rectification of mistake - mistake on the face of record or not - classification of goods - Beneficiale Liquid - DSN Capsules - the appellant filed two separate appeals for the two periods - Revenue states that as the impugned order is common, the said final order will have a binding effect on the appeal, which is pending. Further, he also states that the appellant is seeking a review of the appeal already disposed of, which is not desirable - HELD THAT:- Under the facts and circumstances, firstly both the appeals should have been disposed of together. Secondly, judgement cited by the learned Counsel for the appellant have not been considered as no reason have been cited in the final order for deferring with the views expressed in those judgements. Further, the appellant has suffered prejudice, as appeals were not disposed of together.
Both the appeals tagged together for final hearing - ROM application allowed.
Put up for hearing on 15.07.2019.
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2014 (6) TMI 1012
Pre-deposit - non-compliance with stay order - Held that:- On a query from the Bench the learned Counsel for the appellant failed to produce any evidence in respect of the list of matters or any stay order passed by the Hon’ble Madras High Court. As the appellant failed to produce any order from the appellant authority, we dismiss the appeal for non-compliance of the stay order of the Tribunal.
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2014 (6) TMI 1011
Pre-deposit - non-compliance with stay order - Held that:- The applicant has failed to comply with the stay order. Hence, the appeal is dismissed for non-compliance of the stay order.
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2014 (6) TMI 1002
Non providing the worksheet against the confirmed demand in the de-novo proceedings - Held that:- We find that the Tribunal had given necessary direction in so far as if the adjudicating authority would fail to provide the worksheet of demand to the applicants, the adjudication proceedings may be completed based on examination of the reconciliation statement prepared by the appellant.Hence, for the proper appreciation of the Final Order dated 22.04.13 of the Tribunal, the direction at para-8 would be read with para-9.We do not want to pass any opinion regarding non-furnishing of the documents by the department as contented by the applicants in these applications.The ROMs are disposed of with the above directions.
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2014 (6) TMI 984
Offence punishable u/s 9(1)(b), 9(1)(bb) and 9(1)(bbb) of the Central Excises and Salt Act, 1944 read with Rule 173 of the CER, 1944 - goods removed without determination and payment of duty - Held that: - the learned Magistrate had taken into consideration the length of the proceedings which were protracted on one or the other ground and, therefore, had rightly awarded the sentence of fine. The penalty awarded should necessarily be proportionate to the crime which is committed. The quantum of punishment/sentence would depend on the duty leviable on the seized articles. It is pertinent to note that in the present case, the prosecuting agency has not specifically stated the quantum of duty which was evaded by the accused persons.
It contemplates that in the case of an offence relating to any excisable goods, the duty leviable thereon under this Act exceeds one lakh of rupees, with imprisonment for term which may extend to seven years and with fine. It therefore, follows that the prosecuting agency has to specifically state the duty leviable on the goods which is the subject of Section 9(1)(bb) and (bbb) - In the present case, the same has not been considered by the learned Magistrate or the revisional Court.
The very fact that revision would not be maintainable is a sufficient ground to allow the present writ petition as the judgment passed in a proceeding which is not maintainable would be a judgment without jurisdiction - petition disposed off.
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2014 (6) TMI 959
Legality of deposit of 25% of amount for the first time as this question has not been dealt with by the Single Bench - Tribunal while passing interlocutory order under Section 35F had relied upon a decision in the case of Vandana Global Limited v. Commissioner of Central Excise, Raipur reported in [2010 (4) TMI 133 - CESTAT, NEW DELHI (LB)] and directed deposit of 25% of the duty imposed by the assessing officer - Appellant contended that the aforesaid judgment is no longer a good law. As such, the Single Bench has remitted the matter for hearing afresh to the Tribunal directing it to dispose of the application seeking waiver of pre-condition of deposit of duty and to pass a reasoned order in accordance with law. The said order remitting the case to the Tribunal to decide the application afresh has been questioned by way of the intra Court appeal.
Held that:- the decision of Vandana Global Limited which was relied upon by the Tribunal has been set aside. Thus, fresh decision is required to be relied upon and the Single Bench has considered it appropriate to relegate the matter before the Tribunal to decide the application afresh. We cannot take the onus upon ourselves so as to decide the legality of the deposit of 25% of the amount for the first time as this question has not been dealt with by the Single Bench. - Decided against the revenue
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2014 (6) TMI 953
Entitlement to SSI exemption under Notification No. 1/2003-C.E. - extended period of limitation invoked - Held that:- This Tribunal held it is the case of joint ownership brand “Ravi Masale” by the family members and each of the family member could use the brand name on the products manufactured by them and, accordingly, dismissed the appeal of the Revenue, holding that the assessee is entitled to SSI exemption.
The logo of Jain Group and the words ‘Jain Pipe’ do not belong to any particular company or manufacturer. Further, the respondents have used the words “JAIN PIPE - JPPL”, which identifies the goods with them only in particular. There is no categorical finding nor claim by any other manufacturer as to ownership of “JAIN PIPE”, brand name. We further hold that under the facts and circumstances, there being regular disclosures to the Revenue by the appellant, no case of suppression of facts or contumacious conduct is made out. Hence, extended period of limitation is not attracted. - Decided in favour of assessee
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2014 (6) TMI 940
Cenvat credit reversal - Held that:- As in the facts and circumstances, it is more a case of interpretation of the legal statute and no case is made out of any suppression, fraud or disregard to the provisions of law. The appellant-assessee, without any protest immediately reversed the Cenvat credit on being so pointed out to at the first opportunity, almost 20 months before issuance of the show cause notice. In this view of the matter, in the interest of justice, set aside the imposition of penalty and interest sustained vide the impugned order, but under the facts and circumstances, amount of Cenvat credit reversed is upheld and the same stands confirmed.
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2014 (6) TMI 939
Refund claims for the cesses rejected - Held that:- The appellants were already aware about the provisions of amending notifications, when they set up the unit in the year 2011, so the question of promissory estoppels cannot not arise in their case. In view of the above discussions referred to above are applicable to the petitioner units only and not to the appellants and accordingly, uphold the impugned order with regard to dis-allowance of refund to the appellants, over and above the value addition cap.
The appeals of the appellants listed at Sr. Nos. 2 to 7 of the above table, against rejection of their refund claims for the cesses are rejected and the impugned orders on this issue are upheld.
The appeal of the appellants, listed at Sr. No. 1 of the above table, on the issue of admissibility of year end differential refund between the amount claimed and the amount sanctioned by the adjudicating authority is rejected and the impugned order, as detailed at Sr. No. 1 of the above table is upheld.
The appeal of the appellants, listed at Sr. No. 5 of the above table, on the issue of admissibility of differential refund between the duty paid through PLA and the refund of duty payable in terms of para 2 of the new notification is rejected and the impugned order is upheld.
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2014 (6) TMI 936
Recovery of erroneous availment of refund for an amount paid as duty on HV/LV coils used in the repair of old transformers - Held that:- The appeal of the Revenue on the issue of recovery of erroneous availment of refund for an amount paid as duty on HV/LV coils used in the repair of old transformers, is upheld and the findings of the adjudicating authority in the impugned order with regard to non-deduction of said amount paid as duty on the said HV/LV coils are set aside. Further, the Respondents are ordered to pay back the same through debit entry in their PLA account with re-credit of same amount in their Cenvat credit account.
The appeal of the Revenue on the issue of admissibility of year-end differential amount of refund for the month of March, 2011, in terms of the value addition norms is partially allowed and the impugned order is modified to the extent, as hat the Respondents are entitled to 50% of the amount due to them as per directions of the Hon’ble High Court issued vide interim order dated 8-5-2013, on furnishing of solvent surety to the satisfaction of the jurisdictional Commissioner, subject to the final outcome of decision in LPA filed by the department before the Hon’ble High Court of J&K or any final decision of the Hon’ble Apex Court of India, etc.
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2014 (6) TMI 935
Area based exemption - new notification effect - Entitlement to avail area based exemption, under the new notification, by way of substantial expansion as already availing area based exemption, under the old notification - Held that:- As find that in terms of para 8 of the new notification, all industrial units existing prior to 6-2-2010, are entitled to the area based exemption under the new notification either on undertaking substantial expansion by way of increase by not less than 25% in the value of fixed capital investment in plant and machinery or on having made new investment, after 6-2-2010 which is directly attributable to generation of additional regular employment of not less than 25% over and above the base employment limit. Also find that legal provisions contained in para 8(b) of the new notification do not bar the admissibility of area based exemption to the existing industrial units which had earlier availed the area based exemption under the notification. Thus the existing Industrial units, after having availed area based exemption under the notification, are entitled to avail area based exemption, under the new notification, on fulfilment of required conditions of the new notification.
Regarding admissibility of area based exemption to the appellants under the provisions of the new notification, find that the same is admissible to the existing industrial units provided they fulfill either of the one condition stipulated at para 8(b) of the new notification.
As regards the condition of substantial expansion, by way of increase of not less than 25% in the value of fixed capital investment in plant and machinery, hold that the appellants have fulfilled the condition of substantial expansion, by way of increase of not less than 25% in the value of fixed capital investment in their plant & machinery, as such, they are eligible for area based exemption under the scheme of having undertaken substantial expansion by way of increase of over 25% in the value of fixed capital investment in plant & machinery, before the substantial expansion, in terms of the new notification.
As regards admissibility of refund by way of self credit which the appellants have claimed and availed/utilized observe that though the appellants are entitled to refund of duty, by way of self credit, as they have fulfilled the conditions of substantial expansion contained in para 8(b) of the new notification However, they are entitled to refund of duty in terms of the value addition norms contained in para 2 of the new notification. Since, the amount of refund admissible to the appellants has not been quantified in the impugned orders, therefore, order that the adjudicating authority would quantify the amount of refund admissible to the appellants in accordance with para 2 of the new notification and convey the same to the appellants within 15 days of the receipt of this order. Also order that the refund over & above the admissible amount availed and utilized by the appellants, is liable for recovery along with interest
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2014 (6) TMI 919
Denial of concessional rate of duty - Notification No. 28/96, dated 11-9-1996 - Held that:- Impugned orders are based on either ignorance of the directives of the C.B.E. & C. and the Commissioner of Central Excise, Nagpur or without correctly interpreting the same. In that view of the matter, we are not inclined to accept the contention of the learned ASGI, insofar as the non-exercise of the jurisdiction on the ground of alternative remedy is concerned. For the same reason, we are not inclined to accept the contention of the learned ASGI that since the complete machinery is provided under the statute, we should throw away the petition after having entertained the petition for last 16 years. The contention of Mr. Mishra that if this is permitted every person will rush to this Court, is heard only to be rejected. The learned ASGI is himself aware of various petitions wherein he has appeared and which have been dismissed by the Benches to which either of us are party, on the ground of availability of alternative remedy. However, that has been done at the threshold. The same analogy cannot be applied to the petition which is pending before this Court for last 16 years.
If a waste paper is used as a raw material and if such waste paper itself contains the conventional material, then the resultant product may contain the conventional material more than the permissible limit. As such the method that is adopted by the respondent-Authority would not truly depict as to whether the use of the material at the stage of preparation of pulp was within the permissible limit or not. No doubt that we do not possess any expertise in such matters. However, the Commissioner of Central Excise , Nagpur on the basis of the communication of the C.B.E. & C. has itself now clarified the entire procedure which should be gone into while considering as to whether the assessee is entitled to exemption or not.
Communication of the C.B.E. & C. and the subsequent trade notice only clarify as to what is provided under the notification. The said trade notice or the communication do not have effect of either substituting or replacing as to what is provided under the notification. The said communication and the trade notice are only clarificatory in nature and provide for the manner in which the procedure has to be followed for determining as to whether an assessee is entitled to exemption or not. In any case though the period for which the show cause notices were issued to the petitioner, are prior to the communication of the C.B.E. & C. and the trade notice issued by the Commissioner and the impugned orders are passed much thereafter. The communication of the C.B.E. & C. is dated 24-9-1997 whereas the trade notice is dated 29-10-1997. The impugned orders are passed on 4-12-1997. The Assistant Commissioner of Central Excise who is undoubtedly an Authority inferior to the Commissioner of Central Excise and the C.B.E. & C. ought to have taken into consideration the said communication and the trade notice.
In the light of the communication of the Central Board of Excise & Customs dated 24-9-1997 and the trade notice dated 29-10-1997 issued by the Customs & Central Excise, Nagpur. Insofar as the challenge to the show cause notice dated 2-11-1998 is concerned, we dismiss the petition and direct the petitioner to submit to the authority of the respondent No. 1. - Decided against assessee.
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2014 (6) TMI 911
Waiver of pre dpeosit - Appeal dismissed for non compliance - Held that:- there is no proof on record for compliance of the stay order. - applicant has failed to comply with the stay order. Hence, the appeal is dismissed for non-compliance of the stay order. - Decided against assessee.
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2014 (6) TMI 902
Supplies to SEZ from DTA - Clearance to be treated as “dutiable goods” or “exempted goods” - whether in respect of supplies made by DTA unit to SEZ developer prior to 13-12-2008 has to be treated as exempted clearances as per CENVAT Credit Rules and consequently provisions of Rule 6(3) of CCR, 2004 applies or not - Held that:- Tribunal while rendering the impugned decision, has relied on its earlier decision in the case of Sujana Metal Products Limited [2011 (9) TMI 724 - CESTAT, BANGALORE]. It is submitted by the learned counsel for the appellant that the Hon'ble Karnataka High Court has dismissed the appeal preferred against the aforesaid judgment of the Tribunal and the matter is still pending before the Hon’ble Supreme Court. In the circumstances, we think that we cannot take a different view in this matter. - Decided against Revenue.
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2014 (6) TMI 893
Waiver of pre deposit - Exemption under Notification No. 63/95-C.E. - coal supplier under the mistaken belief that duty on coal has been imposed started paying duty after duly intimating the Central Excise Department and the appellants being buyers of the coal (as an input) took Cenvat credit of duty so paid - Held that:- Exemption is subject to condition and therefore prima facie it is not mandatory for the coal supplier to avail of it. Consequently the very basis for denying the Cenvat credit holding that the coal supplier was mandatorily required to avail of the exemption under the said Notification is fatally hit. Further the judgments cited above also clearly support the appellant’s case. - it is evident that the appellants have been able to make out a strong case for waiver for pre-deposit of the remaining amount. Accordingly, the stay application is allowed, the pre-deposit of the remaining amount and interest is waived under Section 35F of the C. Ex. Act, 1944 and the recovery stayed till the deposal of the appeal - Stay granted.
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2014 (6) TMI 889
Denial of CENVAT Credit - Invocation of extended period of limitation - Imposition of penalty - Bonafide belief - Difference of opinion - Majority order - whether the extended period of limitation could have been invoked in the present case for confirmation of duty demand - Held that:- Rule 2(c) Cenvat Credit Rules, as it stood at the relevant time defined ‘exempted goods’ as goods which are exempt from the whole of the duty of excise leviable thereon, and includes goods which are chargeable to “Nil” rate of duty, and “final products” was defined as excisable goods manufactured or produced from inputs except matches. During the material point of time, the electricity was not an excisable item at all; therefore, it was not exempted goods nor was it a final product. Though Rule 2(f) included furnace oil used in the manufacture of electricity in the category of inputs, credit was available only when electricity was consumed within the factory of production. Therefore, no Cenvat credit of the duty paid on inputs used in the manufacture of electricity which was used outside the factory could have been taken. In the present case before me, the electricity generated was sold outside or taken out of the factory for use in the residential colony etc. Therefore, furnace oil which was used for the generation of electricity did not qualify as an input. Therefore, the availment of credit on furnace oil was not clearly permitted under the law.
A belief can be said to be bona fide only when it is formed after all reasonable considerations are taken into account as held by this Tribunal in the case of Interscape v. Commissioner of Central Excise, Mumbai-I - [2005 (9) TMI 192 - CESTAT, MUMBAI]. In Winner Systems - [2005 (7) TMI 219 - CESTAT, MUMBAI], it was held that blind belief cannot be a substitute for bona fide belief. Applying the ratio of these decisions to the facts of the present case, as can be seen from the records, the appellant neither sought any legal opinion nor any clarification was sought from the department as to the availability of credit on the furnace oil used in the manufacture of electricity, which was wheeled out to the factory. Therefore, the argument of bona fide belief raised by the appellant is only an argument of convenience and not based on any conviction, whatsoever.
Whether penalty could have been imposed under Section 11AC read with Rule 15 of the Cenvat Credit Rules, 2004 - Held that:- In view of the repeated amendments in Cenvat Credit Rules, huge litigation in the country stood generated and in those circumstances, it was held that penalty was not leviable on the appellant/assessee particularly when in a large number of cases, there were conflicting views. Following the same, in the present case also, since the issue related to a question of interpretation of law, in my considered view, imposition of penalty is not warranted.
Appellant had taken the suo motu credit allegedly on the ground that the Commissioner (Appeals) had directed the department to issue a proper notice and extend an opportunity of personal hearing before recovering the ineligible Cenvat credit taken. It is based on these orders, the appellant had taken the suo motu credit as can be seen from the records. Assuming for a minute that instead of the appellant taking suo motu credit, if the department had granted refund, what would be the time limit available to the department for recovery of credit. When a refund is granted in terms of the appellate authority’s order, which is binding on the lower authorities and which is as a result of conscious act to comply with the decision of the higher authorities, it cannot be considered as an erroneous refund and, therefore, limitation under Section 11B of the Central Excise Act, 1944 would not be applicable to such refunds and the general law of limitation would apply. - demand is confirmed and the penalties are set aside. - Decided partly in favour of assessee.
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2014 (6) TMI 859
Captive consumption - marketability - non-woven fabric - Excise duty, interest and penalty - Assessee engaged in the manufacture of Jute backed Floor Coverings - Jute backed Floor Coverings are exempted from the payment of duty - Assessee contended that non-woven fabric which is cleared in market is different from the fabric which is captively consumed and the same is not marketable as such, hence it is not excisable – Whether under the facts and circumstances of this case, the impugned order passed by the CESTAT, holding that the loosely assembled fibre web in roll form emerging at a stage before the exempted finished jute carpet, is marketable and therefore liable to duty, without considering the relevant records and material submitted by the Appellants, is correct and sustainable in law.
Held that:- CESTAT in the impugned order comes to a finding that there is no dispute about the fact that the impugned product "goes through first pass only whereas goods cleared from the factory go through second pass. Therefore, compactness/tensile strength/dimensional stability of 'non-woven fabrics' cleared from factory is much more than the intermediate product." Having come to the aforesaid conclusion and itself making a distinction between the impugned product and the "non-woven fabrics" that were being cleared by the Appellant on payment of the requisite Excise Duty, we find that the CESTAT misdirected itself by shifting the burden on the Appellant of establishing that the impugned product is not marketable.
Department led no evidence whatsoever to establish that the impugned product in the form that it is, is marketable and therefore dutiable under the provisions of the Act. Furthermore, we find that the CESTAT has not taken into consideration several orders passed by it earlier in similar matters such as that of the Appellant and which have been referred to by us, earlier in this judgement - Matter remanded back - Decided in favour of assessee.
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