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Central Excise - Case Laws
Showing 101 to 120 of 1430 Records
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2023 (12) TMI 303
Recovery of CENVAT Credit - scope of input service - dredging of creek bed - HELD THAT:- The principal issue in this dispute is neither that of the appellant not having paid for the service inclusive of tax liability as recorded in the bills raised by the provider nor of such service not having been provided within the factory premises but, in fact, turns on whether the appellant was recipient of service. While ‘input service’ in rule 2(l) of CENVAT Credit Rules, 2004 is broad enough to cover activities that found even indirect use in manufacture, the primary eligibility, arising from rule 3 of CENVAT Credit Rules, 2004 accruing only to the recipient of ‘such service’, is untenable.
It is common ground that the waters, which had been deepened by dredging for approach of barges, did not belong to the appellant. Nor do the waters belong to any particular owner other than the Republic of India. The administrative control over such waters is vested with the Maharashtra Maritime Board (MMB) and any improvement, or enhancement of capability, would render the Maharashtra Maritime Board (MMB) to be recipient of service irrespective of the source of payment for such service. This is an aspect that the appellant has not been able to controvert and it is on this aspect that the eligibility of CENVAT credit must rest for, otherwise, rule 3 of CENVAT Credit Rules, 2004 would be rendered superfluous.
In M/S. JSW JAIGARH PORT LTD. VERSUS COMMISSIONER OF CGST, KOLHAPUR [2023 (6) TMI 239 - CESTAT MUMBAI], the issue for consideration was the entitlement for credit by the port operator that rested upon the area of the port being under the control of the appellant therein. In M/S. JSW STEEL (SALAV) LTD. AND M/S. WELSPUN MAXSTEEL LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, RAIGAD [2022 (1) TMI 967 - CESTAT MUMBAI], the dispute pertains to the services availed for setting up of, and operation, of the jetty which was under undisputed lease to the appellant. The tax discharged on services performed on such leased property, while the waters and ‘creek bed’ were not, does conform to the secondary qualification of being the recipient of the service entitling availment of credit of tax paid on ‘taxable service’ that conform to threshold eligibility by inclusion in definition. The decision of the Tribunal in CCE, NAGPUR VERSUS ULTRATECH CEMENT LTD., [2010 (10) TMI 13 - BOMBAY HIGH COURT] arose in similar circumstances of claim by recipient of service and, hence, would not apply to the resolution of the present dispute.
There are no merit in the appeal which is dismissed.
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2023 (12) TMI 302
SSI Exemption - unregistered unit - clearance exceeded the threshold limit or not - no evidence to indicate actual exports of ‘corrugated boxes’ in which fruits/vegetables were claimed to have been shipped - HELD THAT:- It would appear that the appellant is an unregistered unit and, therefore, had not been following the procedure prescribed under Central Excise Rules,1944 and corresponding notifications in relation to the procedure for export of goods, including packing material through third parties - the duty liability has been fastened on the importer solely on the ground that no evidence existed to indicate actual exports of ‘corrugated boxes’ in which fruits/vegetables were claimed to have been shipped.
The decision of the Tribunal in VADAPALANI PRESS VERSUS COMMISSIONER OF C. EX., CHENNAI [2007 (3) TMI 151 - CESTAT, CHENNAI], which had been cited by the appellant before the original authority and neglected to be considered by him, was distinguishable on the ground that the correlation of the clearances from the factory and the exports had been established.
The argument of the first appellate authority that the inability to determine, by use of records, that ‘corrugated boxes’ supplied by the appellant had in fact been part and parcel of the scheme of export consignment, to be specious. It is natural that fruits/vegetables are exported in suitable containers and it is the reality that the containers themselves are not to be found specifically enumerated in the shipping document. Nonetheless, it is established procedure, in terms of central excise law, to permit such containers to be cleared without payment of duty subject to establishing that the goods did ultimately find use by the merchant-exporter - The evidentiary value of such statutory documents, even though not related to central excise law, appears to have been mis-construed by the first appellate authority. It is, therefore, necessary, for the first appellate authority to appreciate the context in which that evidence was admissible and to examine the details thereof before interfering with the order of the original authority.
Having failed to do so, it is only appropriate that such exercise be undertaken now. To facilitate that, the impugned order is set aside - matter remanded back to the first appellant authority to ascertain the applicability of the evidence of form H and to explicitly detail reasons, if any, for non-acceptance of information contained therein.
Appeal allowed by way of remand.
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2023 (12) TMI 301
Seeking refund of differential duty demanded without issuing show cause notice and without affording an opportunity of hearing to the appellant - violation of principles of natural justice - HELD THAT:- The Hon’ble Supreme Court has consistently held in various decisions that show cause notice is a condition to demand any tax in this regard.
Reference made to the decision of the Hon’ble Apex Court in the case of GOKAK PATEL VOLKART LIMITED VERSUS COLLECTOR OF CENTRAL EXCISE [1987 (2) TMI 64 - SUPREME COURT] wherein in para 9 and 10 the Hon’ble Apex Court has observed An opportunity to be heard is intended to be afforded to the person who is likely to be prejudiced when the order is made before making the order thereof. Notice Is thus a condition precedent to a demand under sub-section (2). In the instant case, compliance with this statutory requirement has not been made, and, therefore, the demand is in contravention of the statutory provision.
The ratio of the decision cited is squarely applicable in the present case because in the present case also, no show cause notice as required in law was issued to the appellant and no opportunity of hearing as required under law was accorded. Hence, by following the ratio of the Hon’ble Apex Court decision, the rejection of refund claim of Rs. 19,55,010/- deposited by the appellant under protest is liable to be refunded to the appellant as prescribed by the law - appeal allowed.
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2023 (12) TMI 300
Clandestine removal - facts not verified properly - violation of principles of natural justice - HELD THAT:- It is seen that in the year 1996-97 itself, the appellant has made more than 15 clearances under DSL. Similarly in respect of exports through others while the Adjudicating Authority has considered only two shipping Bills/Invoices, the Appellant has given the details of nine clearances during 1999-98 and 21 clearances during the period 1998-99. For each of these Invoices, the Appellant has also enclosed the relevant Shipping Bill, E-Way Bill/Bill of Lading and other documentary evidence. This shows that the Adjudicating Authority has not gone through all the documentary evidence properly before coming to his conclusion. The entire proceedings have been taken up on the basis of the turnover shown by the Appellant in their Profit & Loss Account and Balance Sheet. When the Appellant provides the proof that turnover also consists of direct exports and exports through merchant exporters along with the documentary evidence, it is the duty of the Adjudicating Authority to get these facts properly verified and to give a detailed findings as to why the documentary evidence submitted would not be sufficient to prove their exports, if he intends to confirm demand.
As the matter pertains to 1996-97 and 1997-98 and denovo adjudication was to be taken up in 2008, much better and larger efforts should have been made by the Adjudicating Authority to follow the principles of natural justice and to get proper verification done, which has not been done in this case - Appeal allowed by way of remand.
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2023 (12) TMI 299
Clandestine removal - M.S.Rods - Reliability of Computer printouts - deemed document - demands confirmed in the impugned order has relied mainly on the documents recovered from various premises and the statements recorded during the course of investigation - corroborative evidences or not.
Whether the data retrieved from various premises belonged to the Appellant's company and the data can be relied upon as evidence to demand duty? - Whether the conditions mentioned in Section 36B has been followed in this case or not, to rely upon the data retrieved through computer printouts as evidence? - HELD THAT:- Section 65B of Evidence Act is parimateria with Section 36B of the Central Excise Act, 1944. From the above observation of the Hon'ble Apex Court, it is found that unless the conditions of Section 65B(2) of the Evidence Act, which is parimateria with Section 36B(4) of the Central Excise Act are complied with, no reliance can be placed on any computer printouts . Admittedly, the procedure set out in Section 36B has not been followed in this case - in the present case the author of entry of data has not been identified. As per the impugned order the entry in computer was done by Shri Chittaranjan Bhukta or Sri Rajeev Agarwal or Sri Manoj Kumar Sahoo. However, no certificate was obtained from any of them - the material evidence available on record do not establish that the documents recovered from all the Factory, Registered office and the premises at Rameshwar Patna are all belonged to the Appellant Company and the data cannot be relied upon to demand duty - the questions answered in negative.
Whether the procedure as set out in Section 9D of the Central Excise Act, !944 was followed in this case or not? If not followed, then whether the statements recorded under Section 14 of the Central Excise Act, 1944 can be relied upon to demand duty? - HELD THAT:- Had the adjudicating authority followed the provisions of Section 9D and examined the witnesses who have given the statements, the truth in this statement could have come out. Thus, the statements recorded in this case has lost its evidentiary value by not following the provisions of Section 9D. Thus, Procedure set out in Section 9D has not been followed in this case - Question answered in negative.
Whether the allegations of clandestine clearance of finished goods by the Appellants are substantiated with corroborative evidence? - Whether the demands confirmed in the impugned order on clandestine clearance of finished goods is sustainable in the absence of any evidence of procurement of the major raw materials for manufacture of the finished goods M.S. Rods, without invoices? - HELD THAT:- The investigation has not brought in any corroborative evidence to substantiate the allegation of clandestine removal. In view of the above findings, the investigation has failed to establish the alleged clandestine clearance of goods by the Appellants and hence the demands confirmed in the impugned order are not sustainable - question answered in negative.
Whether penalty is imposable on the Appellant company and it's Director and Chief Accountant on the basis of the evidences available on record? - HELD THAT:- In the impugned order, the adjudicating authority has concluded that Shri. G.D Agarwal is behind the entire clandestine activities. The MD of the company was in the direct knowledge of the entire clandestine operations in the company. The Chief Accountant was involved in the preparation of documents. Accordingly, penalty has been imposed on them. However, the evidences brought on record has not established that they are involved in clandestine manufacture and clearance of the goods. As the evidence available on record does not establish the clandestine manufacture and clearance, the penalty imposed on the above said persons is not sustainable - question answered in negative.
Accordingly, the demand of duty confirmed in the impugned order are liable to be set aside. When the duty demand itself is not sustained, the question of demanding interest and imposing penalty does not arise - the impugned order set aside - appeal allowed.
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2023 (12) TMI 251
Relevant date for calculation of interest - interest under Section 11BB of the Central Excise Act, 1944 would accrue from the date of expiry of 3 months from the date of receipt of application for refund or on the expiry of 3 months from the date of communication of the order of the Appellate authority / Court? - HELD THAT:- The issue stands resolved by the judgment of the Hon'ble Supreme Court in RANBAXY LABORATORIES LTD. VERSUS UNION OF INDIA AND ORS. [2011 (10) TMI 16 - SUPREME COURT] wherein after finding that the appellant’s claim for rebate of duty was rejected by the Assistant Commissioner and was subsequently allowed in appeal which was affirmed in further appeal before the Joint Secretary, Government of India it was held Section 11-BB of the Act lays down that in case any duty paid is found refundable and if the duty is not refunded within a period of three months from the date of receipt of the application to be submitted under sub-section (1) of Section 11-B of the Act, then the applicant shall be paid interest at such rate, as may be fixed by the Central Government, on expiry of a period of three months from the date of receipt of the application.
It is clear from the extract that the submission of the learned counsel for the respondent on the basis of the Explanation to Section 11BB of the Act to suggest that in view of the deeming contained therein, the interest payable on delayed refund under Section 11BB of the Act would accrue only in the event of delay in making the refund beyond 3 months from the date of the order of the adjudicating authority / appellate authority / Court was rejected by the Hon'ble Supreme Court.
The above judgment of the Hon’ble Supreme Court in the case of Ranbaxy has been subsequently followed in the case of Manisha Pharmo Plast Private Ltd., v. Union of India [2020 (11) TMI 726 - SUPREME COURT].
Following the above judgments of the Hon’ble Supreme Court, this Court has no hesitation to hold that interest on refund in terms of Section 11 BB of the Act would accrue in the event of delay in grant of refund beyond 3 months from the date of application i.e., 11.07.2016 in the present case - the respondents are directed to calculate the statutory interest in terms of Section 11 BB of the Act i.e., 3 months from 11.07.2016 (date of application for refund) until 17.12.2019 when the rebate was actually granted and pay the same within 4 months from the date of receipt of a copy of this order.
Petition disposed off.
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2023 (12) TMI 250
Principles of natural justice - opportunity had not been accorded to the appellant by the first appellate authority for being heard - refund of duty paid under protest - HELD THAT:- It is found from the impugned order that the issue of limitation has been dealt with in terms of rule 233B of Central Excise Rules, 1944 which came into force only from 11th May 1981. Consequently, and in the absence of any mechanism prescribing for ‘protest’, the presumption in the adjudication order of failure to ‘protest’ is not tenable. The appellant claims that ‘protest’ had been filed with the department by mail, ‘under certificate of posting’; that has not been denied.
The first appellate authority has taken upon itself to infer that, with certain eventualities not occurring, presumption of ‘not paid duty under protest’ was to be operated as default - it is found from the decision of the Hon’ble Supreme Court, in BHOR INDUSTRIES LTD. VERSUS COLLECTOR OF CENTRAL EXCISE [1989 (1) TMI 128 - SUPREME COURT], that classification list came to be filed for the first time in November 1975. At the same time, in the same judgment, it has been noted that the classification list had been approved by the competent authority in December 1977 before which, in a separate dispute, the first appellate authority in order of June 1974 had held the goods not liable to excise duty.
Notwithstanding the lapse of time since the dispute on excisability was taken up and concluded and its appearance before the the Tribunal for the third time, a fresh decision cannot be directed after taking the submission on facts, as well as certificate of the Chartered Accountant, into account - matter remanded back to the first appellate authority on the terms and conditions directed by the Tribunal formerly and subject to the law as judicially determined.
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2023 (12) TMI 249
Availment of credit to the extent of ‘loss in transit’, ascertained from measurement at the factory - rule 3 of CENVAT Credit Rules, 2004 - lower authorities had adopted the benchmark of 2% as the ‘tolerance’ and further denied credit wherever the difference was more than 0.4% as established by issue of debit notes - HELD THAT:- It would appear that payment of duty by the supplier on clearance of the goods, as well as inclusion thereof in invoices raised on appellant, is not in dispute and objection is solely on the ground that, in terms of rule 2(k) of CENVAT Credit Rules, 2004, only such ‘duty paid’ goods as have been used in the manufacture of excisable goods are entitled to be availed as credit.
The issue is no longer res integra and that, in SAVITA OIL TECHNOLOGIES LTD VERSUS COMMISSIONER OF CENTRAL EXCISE BELAPUR, NAVI MUMBAI [2022 (6) TMI 1175 - CESTAT MUMBAI], it was held that Availment of CENVAT credit of duties paid on inputs is enabled by rule 3 of CENVAT Credit Rules, 2004. The credit taken by the appellant is the duty of central excise paid by the supplier as recorded in the invoices and any difference in quantity, manifested in ‘goods receipt note (GRN)’ on actual weighment at place of receipt, does not alter the tax thus borne on the goods except when credit accrues to the supplier through appropriate debit notes raised by recipient. No such document is placed on record. There is no evidence of any of inputs having been returned to supplier or rerouted elsewhere.
Credit allowed - nothing remains in the impugned order which is set aside - appeal allowed.
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2023 (12) TMI 248
Prayer for restricting the penalty to the extent of pre-deposit, which they have already paid - relevance of statements - obligation of law as per Sec. 9D of the Central Excise Act, 1944 not met - Illegal availment of CENVAT credit of CVD paid on the imported goods by the manufacturers of aluminium products without physically receiving the goods - Misuse of imported goods - evasion of Central Excise Duty - HELD THAT:- It is seen that section 9D is relevant for the purpose of proving the truth of a fact, in any prosecution launched for an offence under the Central Excise act, 1944. The impugned order does not emanate from a proceeding of prosecution. A five judge Bench of the Apex Court by a majority decision in THOMAS DANA VERSUS STATE OF PUNJAB [1958 (11) TMI 7 - SUPREME COURT] held that there is no escape from the conclusion that the proceedings before the Sea Customs Authorities under s. 167(8) (which was a pre-cursor to the Customs Act, 1962, a sister Act to the FA 1994 and CEA, 1944), were not "prosecution" within the meaning of Art. 20 (2) of the Constitution.
The judgement above makes it clear that offences and penalties are of two distinct kinds. First there are contraventions of the Act and Rules thereunder which are dealt with by Customs officers and the penalty for which is imposed by them, called customs offences. Besides these there are criminal offences which are dealt with by Magistrates and which result in conviction and sentence of imprisonment and/or fine. Action by quasi-judicial officers under CEA 1944 is not done as per the provisions of criminal law. Prosecution of offenders are launched separately in a criminal court.
The principal idea in this case is as per section 9D(1) of the Central Excise Act 1944, which clearly states that it is concerned with a statement which shall be relevant, for the purpose of proving, in any prosecution for an offence under the Act. Detailed Criminal Court procedures are not expected for proceedings having only civil consequences - there are no lacunae in the proceedings by the Adjudicating Authority and the impugned order does not deviate from the provisions of section 9D ibid.
Whether Appellants had prior knowledge of the clandestine activity? - HELD THAT:- The charges against the appellants have been made after a very detailed investigation of clandestine activity by a group of people who have abetted to evade payment of duty by misusing high-sea sales and CENVAT schemes. It is difficult to find direct evidence in such cases and they are mostly proved by a mix of direct and indirect evidence, as duty evasion is seldom an open affair. The blame worthy act has hence to be inferred from the circumstances and the conduct of the people involved - The circumstances as brought out in the impugned order taken cumulatively form a chain leading to the conclusion that the Appellants were fully involved and abetted with the main notice in the clandestine scheme to wrongly utilise inadmissible CENVAT credit at the cost of the exchequer.
Also, the discussion in the impugned order has established the role and knowledge of the appellants in the clandestine activity designed to misuse CENVAT credit.
Imposition of penalty - prayer of the Appellants is to confine the penalty to the amounts of pre-deposits made - HELD THAT:- The involvement of the Appellants has been established mainly on the basis of collaborative statements, perhaps due to the clandestine nature of the activity and the lack of proper documentation in such cases, as discussed above. However, the imposition of stiff penalties requires stronger evidence. Hence to that extent the penalties imposed on the Appellants are disproportionate and needs to be modified - it is also found that the matter relates to a very old issue and there would be no purpose in extending the litigation on the matter of penalty.
Appeal disposed off.
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2023 (12) TMI 247
Valuation - inclusion of excess freight collected from the dealers in the assessable value - HELD THAT:- In the present case, it is undisputed fact that the place of removal of excisable goods is a factory gate of the appellant. It is also found that in the case of ex-factory sale, the freight amount collected is not includible in the assessable value of the excisable goods.
This issue is no more res-integra that the excess freight collected by the appellant from the buyer is merely a profit and no excise duty can be levied on such profit as held in the various decisions - the appellant has sold the vehicles to the dealers at the ex-factory price and the title is transferred to the buyer at the factory gate and the appellant made arrangement for the transportation of vehicles on the request of the dealers. Since, the title in the vehicles is transferred at the factory gate, all the risk of damage during the transportation is that of the dealer and therefore, the assessable value is the transaction value in terms of Section 4(1)(a) of the Act and the provisions of Section 4(1)(b) and Valuation Rules are not applicable.
This issue has recently been considered by the coordinate bench of the Ahmedabad in the case of KASHYAP SWEETNERS LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE & ST, VAPI AND JITENDRA PANDEY VERSUS COMMISSIONER OF CENTRAL EXCISE & ST, VAPI [2023 (7) TMI 1111 - CESTAT AHMEDABAD], wherein the Tribunal has held excess amount of freight from the customer is profit on account of transportation and not part and parcel of the value of the goods therefore, same cannot be included in the assessable value.
The impugned orders are not sustainable in law - Appeal allowed.
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2023 (12) TMI 246
Eligibility for exemption under Notification No. 6/2006-CE, dated 01.03.2006 - goods supplied against International Competitive Bidding.
Denial of exemption on the ground that Project Authority Certificates were not issued by the prescribed Authority i.e. Chairman and Managing Director of NTPC as required under Condition No. 86(b) of Serial No. 400 of Customs Notification No. 21/2002-Cus dated 01.03.2002.
HELD THAT:- The supplies made by the Appellants were for the projects, meets all the stipulated criteria specifically awarding of contract under ICB route. Further, there is a provision for supply through sub-contractor also, even though the sub-contractor might not have directly participated in the process of ICB for getting the contract, which was obtained by the main contractor namely BHEL in this case. It is also now clear that both these projects were Mega Power Projects in terms of certificates issued by the Ministry of Power and that these two projects would have been entitled for exemption under Customs Notification No. 21/2002-CU (serial no. 400). The wordings in the certificate issued by the Ministry of Power clearly matches with the wordings at serial no. 400 of this Notification.
Therefore, there is no specific requirement for signing of the Certificate by Chairman not of the PSU which is only in relation to the goods imported into India. In the case of goods procured domestically, the exemption is available as long as the supplies have been made against ICB and projects are meeting the criteria. In this case, the supplies have been made by the sub-contractor through contractor to the project duly recognised for entitlement of exemption from the customs duty also, in case they import goods for said project. Thus, there are sufficient documents on record to prove that the Appellants were not required to pay any duty and were clearly entitled for benefit of Notification No. 6/2006.
No duty is leviable on clearances made to these two projects through the main contractor M/s BHEL - Since the duty is not leviable, the penalty is also not imposable on the Appellants - Appeal allowed.
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2023 (12) TMI 245
Process amounting to manufavture or not - cutting, boring, beveling, threading operations undertaken by the appellant company on other materials, namely seamless pipes/tubes.
Whether the appellant have undertaken processes amounting to manufacture, in respect of ‘Drill Pipes/ Drill Rods as per Section 2(f) of the Central Excise Act, 1944 and leviable to central excise duty? - HELD THAT:- The process of manufacturing of drill rods/ drill pipes from raw material stage to final product stage is that the Round Bars and Semaless pipe are their main raw materials. The Round Bar are used to manufacture connectors (Male and Female). The Round bar is cut into required size on the bandsaw machine before subjecting it to machining operations (on the lathe machine) that is, drilling to make solid round bars into hollow state, turning to make the outer diameter of appropriate size, threading and slotting. The product namely, Connector, is thus manufactured. In Drill Pipe Section, Seamless pipes of different diameters which are another major raw material for Drill Rods were stored. In the said section, on Lathe Machines the seamless pipes are cut into required size and then boring and beveling operations to make the pipe suitable for further welding with connectors are carried out at both the ends of the said pipes so that the connectors (Male and Female) can be fitted at both ends of the seamless pipes and thereafter are welded together. The welding of the connector with the seamless is carried out manually. The seamless pipe so fitted and welded with the male and female connectors at the end is final product called the ‘Drill Rods’. Then the painting was carried out by the workers on the said ‘Drill Rods’.
The process undertaken by the appellant satisfies the test ‘manufacture’ as above and consequently it is concluded that the resultant products of the appellant are liable to payment of Excise duty.
Demand confirmed by the Ld. Commissioner for Spindle Subs/Bits Subs/Connectors - HELD THAT:- Appellant argued that goods for which this demand of duty is confirmed were duly accounted for in statutory records of the appellant company and appropriate duty was paid on these goods while their clearance from the factory, and such clearances were also recorded in ER-1 returns. Since the said facts cannot be verified at this stage, it is opined that for verification of these facts viz. whether appellant has paid the appropriate duty or not on impugned goods, the case needs to be remanded back to the Adjudicating authority and the Ld. Adjudicating authority will examine the evidences which may be submitted by the appellant relating to payment of duty on disputed goods and thereafter will pass a fresh decision relating to the demand of duty of Rs. 9,89,159/-.
Confiscation of goods - HELD THAT:- When the goods have already been removed and are not available for confiscation, the goods cannot be confiscated - on perusal of the statements recorded by the investigating officers we find that the appellant was having full knowledge as to what is to meant by ‘manufacture’ but still they mis-stated that the processes under taken by them do not amount to manufacture. Further intention to evade payment of duty on disputed goods is further established by the revenue that Appellant not maintaining any ‘Daily Stock Accounts as prescribed under Rule 10 of the Central Excise Rules 2002.
The appellants have also pleaded that they had a bona fide belief that their goods are not chargeable to duty - It is difficult to understand this plea. Evidences on record clearly indicate that they were aware that the goods are chargeable to duty and their process is amount to manufacture. Statement recorded during the investigation indicates that they were fully aware about their duty liability and manufacture of the disputed goods.
Penalty imposed under Rule 26 of CER, 2002 on Shri Sanjay Jayantilal Gandhi, Director (Commercial) - HELD THAT:- Revenue disputed that earlier adjudication order passed vide OIO dated 31.01.2013, the authority had imposed a personal penalty of Rs. 50 Lacs. However in the present OIO the penalty stands reduced to Rs. 5 Lacs. Appellant also disputed that penalty of Rs. 5 Lacs not imposable - It is found that penalty imposed by the Learned Commissioner in impugned order is proper. Penalties are very much on the lower side and are not incommensurate with the acts and omissions of person concerned. The finding given by the Learned Commissioner clearly held that Shri Sanjay Jayantilal Gandhi knows and had reason to believe that goods were liable to confiscation therefore he was liable for penalty under Rule 26.
Appeal disposed off.
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2023 (12) TMI 244
Confiscation of cash seized by the investigating officer from the house of the partner of the Appellant firm - cash amount seized from the premises of the partner of the Appellant firm was against the sale proceeds of clandestinely removed goods - HELD THAT:- The Learned Commissioner (Appeal) has referred to para 4.2.3 wherein the Adjudicating Authority has clearly found that the cash of Rs. 50,73,710/- seized from the residence of Shri Mahesh Chaodhary, partner of the Appellant is sale proceeds of the excisable goods which has been sold by the noticee without licit documents and without payment of duty - it is found that after giving this clear finding by the Adjudicating Authority, he should have passed an order for confiscation of the cash further no order on proposal of confiscation made in the show caused notice was passed by the Adjudicating Authority. At the same time the cash which was seized was adjudged against the duty, interest and 15% penalty. Therefore, there is an apparent error in the order of the Adjudicating Authority, accordingly the Learned Commissioner (Appeal) instead of straightway confiscating seized cash should have remanded the matter to the Adjudicating Authority.
The Appellant also raised the issue on the provision of section 11 AC (1) (d) that after payment of duty, interest and 15% penalty entire proceeding of the show cause notice should have been concluded and no confiscation could have been ordered. In this regard, it is found that since Adjudicating Authority had given clear finding that the cash seized by the investigating officer is liable to confiscation in such case without passing any order on the confiscation of the cash the adjustment of the same towards the duty, interest and penalty is also incorrect.
Thus, the matter relates to confiscation of seized cash needs to be reconsidered by the Adjudicating Authority - appeal allowed by way of remand.
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2023 (12) TMI 243
Reversal of CENVAT Credit - credit availed on inputs alleged to have been written off in their books of account in accordance with Rule 3(5B) of Cenvat Credit Rules, 2004 - HELD THAT:- The condition precedent under Rule 3(5B) of CCR, 2004 is, if the value of any inputs/goods have been written off fully or partially or where any provision to write off fully has been made in the books of account, in respect of value of any inputs, then the manufacturer or service provider, as the case may be, shall pay an amount equivalent to the Cenvat credit taken in respect of the said inputs.
In the facts and circumstances of this case, there being no writing off or removal of inputs under the provisions of Rule 3(5B) of CCR, 2004, the same is not attracted - Appeal of Revenue dismissed.
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2023 (12) TMI 173
Restoration of appeal - non payment of necessary pre-deposit under the provisions of Section 35 of the Central Excise Act, 1954 - HELD THAT:- The applicants-Directors themselves were filing the applications for restoration of the appeals which had already been dismissed by the Tribunal after noticing the non-compliance of the order not only of the Tribunal but also the order of this Court dated 10.10.2013 (Annexure A-6) whereby only Rs. 6 crores was to be deposited. As noticed above, the Apex Court had reduced the amount further to Rs. 4 crores and the appeal was only to be restored subject to the said deposits. The said amounts had never been deposited. The Directors could not hide behind the legal shield that the company had been directed to pay the amount and they were the persons who were agitating before this Court and the Apex Court that the company was functioning through them.
The Tribunal in such circumstances has over-stepped its jurisdiction by allowing the application for condonation of delay and restoration of the appeals and thereafter proceeded ahead with the matter for the reasons best known to it. We do not wish to comment on the orders passed by the Tribunal in the present facts and circumstances.
The question of law must be answered in favour of the Revenue that the Tribunal had no jurisdiction and would have become functus-officio once the amounts had never been deposited inspite of the directions in the SLPs dated 21.08.2015. The applications filed at the belated stage by the Directors themselves in the year 2018 for condoning the delay on 10.08.2018 was apparently time-barred and there was no sufficient cause to condone the delay also which had been done by the Tribunal.
Appeal allowed.
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2023 (12) TMI 172
CENVAT Credit - intimation/declaration regarding exercise of option in terms of Rule 6(3A) of the said Rule was not given to the jurisdictional officer - HELD THAT:- Enough, while acknowledging separate location of both the premises and separate maintenance of account for both manufacturing and trading activities, the Commissioner has apparently reached at a finding that common input services were being used by the Appellant for both trading and manufacturing activities as Appellant had been maintaining common Balance Sheet for its manufacturing as well as trading activities, despite the fact that Balance Sheet of the Company records the financial transactions including Profit & Loss, Assets & Liability of the entire Company and it has got nothing to do with availment of services which are recorded in the accounting package, as such, separately.
The issue is no more res integra in view of consistent decisions of this Tribunal that has attained finality with the approval of various Appellate Courts that Rule 6(3)(i) ibid cannot be made automatically applicable on failure to intimate in writing about options to be availed by the assessee but here the facts are completely different in the sense that Appellant disputed the demand saying that it had not availed any common input services for its trading activity, but accepted the observation of Audit without challenging the legality of the issue only to set the dispute at rest. Therefore, proportionate reversal, when made it in compliance to Audit report, is well within the knowledge of the Respondent- Department. Such a paper work in putting a written intimation would have added no additional advantages to the Appellant.
In view of the settled principle of law that in the absence of such intimation in writing Rule 6(3)(i) cannot be applied to confirm the demand by taking 5%/6% of the entire credit amount.
The order passed by the Commissioner of Central Excise, Pune-I is hereby set aside - Appeal allowed.
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2023 (12) TMI 171
Valuation - Inclusion of value of scrap in the assessable value determined on the basis of sale price of the manufacturer or not - HELD THAT:- The plethora of decision being passed after the judgment of P.R. ROLLING MILLS PVT. LTD. [2010 (9) TMI 1072 - SC ORDER] in which consistent findings was that value of scrap need not be included in the assessable value.
Appellant had rightly placed the following judgments namely SRF LTD. VERSUS COMMISSIONER OF C. EX., CHENNAI-I [2007 (3) TMI 613 - CESTAT, CHENNAI] Affirmed by Supreme Court in SRF LTD. VERSUS COMMISSIONER [2016 (4) TMI 1068 - SC ORDER], GHATGE PATIL INDS. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, PUNE [2005 (7) TMI 648 - CESTAT MUMBAI], M/S AUTOMOTIVE STAMPINGS AND ASSEMBLIES LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE PUNE-I [2019 (5) TMI 1169 - CESTAT MUMBAI], AD-MANUM PACKAGING LTD. VERSUS CCE, INDORE [2016 (9) TMI 630 - CESTAT NEW DELHI], CCE AHMEDABAD-II VERSUS M/S RECLAMATION WELDING LTD. [2014 (8) TMI 186 - CESTAT AHMEDABAD], to support his stand apart from the fact that in the Appellant’s own case, for two other periods pre and post 2007, demand against the Appellant has been set aside for the reason that value of scrap need not be included in the assessable value.
The impugned order set aside - appeal allowed.
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2023 (12) TMI 170
Levy of Central Excise Duty - aluminum dross and skimming generated while processing aluminum ingots - HELD THAT:- Reliance placed in the decision of Tribunal, in dispute for the period May 2008 to December 2011 at the Taloja unit and Daheli unit, had, in HINDALCO INDUSTRIES LTD VERSUS COMMISSIONER OF CENTRAL EXCISE, NAVI MUMBAI AND NAGPUR [2022 (12) TMI 1295 - CESTAT MUMBAI] where the demands set aside.
There are no reason to uphold the impugned order - appeal allowed.
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2023 (12) TMI 169
Provisional clearances or not - Valuation - inter-unit transfer - Re-determination of liability as finalization of ‘provisional assessment’ - HELD THAT:- In the absence of exercise of option by the assessee for ‘provisional assessment’, it is not open to central excise authorities to deem the clearances to have been provisional and to proceed with final assessment for each year.
The impugned order set aside - appeal allowed.
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2023 (12) TMI 168
Export of readymade garments - procuring the packing material from domestic market duty-free as per Rule 19(2) of Central Excise Rules, 2001 - Violation of Condition No. 8 of the Notification No.94/2004-Cus. dated 10.9.2004 - eligibility for the exemption Notification No.43/2001-CE(NT) dated 26.6.2001 or not - HELD THAT:- In the present case, the appellant had complied with the procedures laid down under Notification No.43/2001-CE(NT) dated 26.6.2001 in procuring the packing materials which are being used in the manufacture of readymade garments and the finished goods are ultimately exported under the scheme. Also, in these circumstances, denying the benefit of Notification No.43/2001-CE(NT) dated 26.6.2001 in procuring the packing materials duty-free alleging violation of Condition 8 of the Notification No.94/2004-Cus. dated 10.9.2004 cannot be sustained.
The impugned order is set aside - the appeal is allowed
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