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Showing 121 to 140 of 5208 Records
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1997 (12) TMI 446
The Appellate Tribunal CEGAT, New Delhi allowed the appeal by way of remand, condoning any delay in filing the appeal and directing the Commissioner (Appeals) to decide the issue on merit. The department was directed not to auction confiscated goods during the appeal's pendency. (1997 (12) TMI 446 - CEGAT, New Delhi)
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1997 (12) TMI 445
Issues:
Under-valuation of exported goods, invocation of Section 113(d) of FERA and Section 18 of Customs Act, imposition of penalty under Section 114(1) of Customs Act, consideration of collaboration agreement with a foreign firm, invocation of Section 14 of Customs Act, burden of proof on department for under-valuation, lack of detailed examination by lower authority.
Analysis:
The appeal concerns the under-valuation of goods intended for export by the appellants. The lower authority found the declared value unacceptable and invoked Section 113(d) of FERA and Section 18(1)(a) of FERA, 1973. The lower authority also referred to Export Control Order 1/88-ETC, stating that non-conforming goods attract Customs Act provisions. The appellants admitted under-invoicing, with discrepancies of 25% and 40% for different models. Consequently, the violation of FERA and Customs Act was established, leading to a penalty of Rs. 3,00,000 under Section 114(1) of Customs Act, 1962.
The appellant's representative argued a collaboration agreement with a foreign firm for manufacturing radio cassette tape recorders. They contended that the negotiated price was fair in international trade, disputing under-valuation accusations. The advocate highlighted the omission of considering Section 14 of Customs Act, 1962 by the lower authority and the lack of determination of correct goods value. The department's representative defended the charge based on the goods' export price being lower than the domestic price.
The appellate tribunal noted the lower authority's suspicion of under-valuation based on domestic prices but emphasized the necessity to consider Section 14 of Customs Act for export valuation. It critiqued the lack of discussion on Section 14 parameters and burden of proof for under-valuation. The tribunal highlighted the absence of a conclusive determination on the extent of under-invoicing by the lower authority, emphasizing the need for a detailed assessment and evidence on under-invoicing degree.
Ultimately, the tribunal found the lower authority's examination inadequate and remanded the case for a fresh consideration. It directed a thorough review, including adherence to Section 14 of Customs Act and evidence-based determination of under-invoicing extent. The appeal was allowed by remand, with the pre-deposit to await the final adjudication outcome.
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1997 (12) TMI 444
Issues:
1. Inclusion of commissioning and erection charges in the assessable value of machinery under Chapter 84 of Central Excise Tariff Act, 1985.
Detailed Analysis:
The judgment by the Appellate Tribunal CEGAT, Mumbai involved a dispute regarding the inclusion of commissioning and erection charges in the assessable value of machinery manufactured by the appellants falling under Chapter 84 of the Central Excise Tariff Act, 1985. The department alleged that the appellants were charging these additional charges for installation at the customer's premises but did not include them in the assessable value declared in the price list. Consequently, a duty demand of Rs. 22,500 was issued for the period between January and February 1985. The Addl. Commissioner of Central Excise & Customs, Vadodara held that such charges enhance the value and marketability of the products, citing the Supreme Court judgment in the case of Union of India v. Bombay Tyre International. Therefore, he confirmed the duty demand.
The appellants, represented by Shri S.C. Bhide, argued that the erection and commissioning charges were incurred post-removal of the machines from the factory and were optional, not compulsory. They referred to the decision of the Central Advisory Council and previous Tribunal decisions to support their contention that such charges should not be included in the assessable value. They highlighted that these charges were post-removal expenses and did not contribute to the manufacturing or marketability of the product, as held in previous Tribunal cases.
On the other hand, Shri S.V. Singh, representing the department, contended that there was no evidence to suggest that the machinery at the erection site became immovable property, implying that the charges should be included in the assessable value.
After careful consideration of the submissions, the Tribunal found merit in the appellants' argument. They noted that the machinery was removed to the customer's site for installation after full manufacturing, and the installation and commissioning charges were optional at the customer's preference. Since this claim was not rebutted, the Tribunal relied on previous decisions, including the one involving Jenson and Nicholson (India) Ltd., which held that optional charges like these should not be included in the assessable value. The Tribunal concluded that such charges were post-removal expenses with no direct connection to the manufacturing or marketability of the product. Consequently, the impugned order was set aside, and the appeal was allowed.
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1997 (12) TMI 443
The duty demand of Rs. 20,04,492/- is not disputed. The appellant made a voluntary payment without a show cause notice. The Adjudicating Officer imposed a penalty of Rs. 12 lakhs, which was reduced to Rs. 1,00,000/- on appeal. The appeal is dismissed.
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1997 (12) TMI 442
Issues:
- Benefit of Modvat credit in respect of Hydraulic excavator used in the mine.
Analysis:
The appeal before the Appellate Tribunal CEGAT, Madras centered around the issue of whether the appellant was entitled to the benefit of Modvat credit for a Hydraulic excavator used in the mines adjacent to the factory for mining limestones. The appellant's counsel argued that the entire process, from mining the limestones to crushing them and using the resulting material in the manufacture of cement, was integrally connected with the production of cement. Reference was made to a previous decision where a similar benefit was granted. However, it was noted that in that case, it was unclear whether the crushing took place within the mine premises.
The Tribunal considered the submissions from both sides, including the arguments put forth by the appellant's counsel and the decision of the Hon'ble Supreme Court cited. It was emphasized that the Supreme Court decision was related to sales tax provisions and not Modvat credit. The Tribunal referred to Rule 57Q and a previous decision dated 11-7-1997, where it was observed that mining activity and cement factory operations are distinct under different Acts. The Tribunal highlighted the definition of a factory as a place where manufacturing activity occurs, and concluded that the mining process could not be considered part of the cement manufacturing process. Therefore, the benefit of Modvat credit was denied based on the lack of integral connection between mining and cement production.
In light of the previous decision and the analysis of the operations involved, the Tribunal dismissed the appeal filed by the appellants. The Tribunal reiterated that the process did not fall within the scope of Rule 57Q, as it was not integral to the manufacture of the notified finished product, cement. The decision was based on the understanding that activities generating raw materials must be directly connected to the manufacturing process to qualify for Modvat credit.
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1997 (12) TMI 441
The judgment by the Appellate Tribunal CEGAT, Madras, in Appeal No. 5296/93 and Appeal E/5297/93 relates to the includibility of software and bought out items in the assessable value of computers. The cost of software is not includible as per a Supreme Court ruling. The Numerical Co-Processor is considered essential, but Dot Matrix Printers are not. The tribunal set aside the order including the value of software and printer, reducing the penalty imposed on the Appellant. Appeal No. 5297/93 was also allowed.
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1997 (12) TMI 440
Issues:
1. Interpretation of exemption notification under Notification No. 96/91 for imported machine.
2. Determination of whether the imported machine qualifies for exemption under Sl. Nos. 12 and 84 of the notification.
3. Analysis of the functions performed by the imported machine and its classification under the notification.
4. Comparison with relevant case law and application of legal principles in interpreting the notification.
5. Consideration of the scope and intent of the notification in relation to the imported machine.
6. Decision on the refund claim based on the interpretation of the exemption notification.
Analysis:
The appeal challenged the Order-in-Appeal confirming the Order-in-Original regarding the classification of an imported machine from Switzerland under Notification No. 96/91. The issue revolved around whether the machine qualified for exemption under Sl. Nos. 12 and 84 of the notification. The Assistant Collector and the Collector (Appeals) considered the machine as a combination of machines under both Sl. Nos. 12 & 84, not explicitly listed in the Table to the Notification, leading to denial of exemption. The nature of the imported machine, described as a De-soldering machine with various functions, was not disputed.
The Tribunal analyzed the language of Sl. Nos. 12 and 84 of the notification, which covered an automatic component insertion system and a de-soldering machine, respectively. Both lower authorities acknowledged that the imported machine performed functions of machines listed under these serial numbers. The Tribunal emphasized a liberal interpretation of exemption notifications, citing the Supreme Court's stance on understanding terms in such notifications within their context and ordinary understanding. It concluded that the imported machine, combining functions of Sl. Nos. 12 & 84, should be considered a combined machine covered by the notification.
The Tribunal delved into the intent of the notification, aimed at providing relief to the electronic industry by reducing customs duties substantially. It noted that the notification encompassed a wide range of machines, intending to benefit manufacturers in the electronic sector. Considering the essential function of the combined machine in de-soldering and soldering, the Tribunal reasoned that if the appellant had imported two separate machines for these functions, each would have qualified for exemption. Hence, it deemed it reasonable to extend the benefit of the notification to a single machine combining functions covered by the Table.
In distinguishing a previous case cited by the department, the Tribunal highlighted that the imported machine's functions aligned with those covered by Sl. Nos. 12 & 84, unlike the case in question. Consequently, the Tribunal held that the imported machine fell within the scope of the exemption notification, overturning the lower authorities' decision. It remanded the refund claim for reconsideration based on the machine's eligibility for exemption, granting the appellant an opportunity for a fresh hearing.
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1997 (12) TMI 439
Issues: Modvat credit eligibility based on invoice markings and duplicate copies.
In the judgment delivered by Commissioner (Appeals) in the case of M/s. Kamakhiya Steels (P) Ltd., the appellant filed appeals against the Order-in-Original passed by the Asstt. Commissioner, Central Excise, Gwalior. The appellant also filed applications under Section 35F of the Central Excise Act, 1944 for the waiver of predeposit of the amount under the impugned orders. During the personal hearing, the advocate representing the appellant argued for the validity of documents for claiming credit and relied on specific case laws.
The main issue in Appeal No. 73/96 was the denial of credit due to the invoice not being marked as 'Duplicate for Transporter.' However, it was argued that the invoices were issued before the requirement for duplication marking and the necessary certificate of duty payment was provided by SAIL, making the documents valid for Modvat credit. The Commissioner (Appeals) found the impugned order unsustainable and allowed the appeal.
In Appeal No. 75/96, the appellant took credit on an invoice not marked as 'Duplicate Copy' but as 'For Check Post.' The authenticity of the documents was not in question, and it was argued that the requirement for duplication was to prevent misuse of credit. Since the suppliers and appellants operated in the same jurisdiction, measures could be implemented to prevent misuse. The Commissioner (Appeals) held that procedural lapses should not disallow Modvat credit if duty payment and use of inputs were not in doubt, thus allowing the appeal and setting aside the impugned orders.
The Commissioner (Appeals) decided to dispose of both appeals by a single order, finding in favor of the appellant in both cases based on the validity of documents for claiming Modvat credit and the absence of doubt regarding duty payment and input utilization. The appeals were allowed, and the impugned orders were set aside, with the stay applications and appeals being disposed of accordingly.
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1997 (12) TMI 438
The appeal arose from an order denying benefit of certain notifications to the appellants, who were manufacturers of Brass utensils. The Tribunal decided in favor of the appellants, citing previous judgments, and set aside the impugned order, allowing the appeal.
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1997 (12) TMI 437
The appeal concerns the classification of Chucks and the applicability of Notification No. 156/86. The lower appellate authority assessed the goods under T.H. 8466.93 and extended the benefit of Notification 172/89, but the appellants seek the benefit of Notification No. 156/86. The lower appellate authority ruled in favor of the appellants regarding unjust enrichment, but did not examine the issue on merits. The appellate tribunal set aside the lower appellate authority's order and remanded the matter to the original authority for reconsideration of the issues related to refund, merits of short-shipped goods, and the benefit of Notification 156/86. The appeal was allowed by way of remand.
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1997 (12) TMI 436
The appeal was filed against the order classifying coffee substitute under Tariff Heading 0910.20. The appellants argued that the product is mainly coffee powder, but the tribunal upheld the classification under Heading 0901.20 for coffee substitutes containing coffee in any proportion. The appeal was dismissed.
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1997 (12) TMI 435
The Appellate Tribunal CEGAT, New Delhi allowed the appeal regarding a refund claim for enhanced duty on Phenol Formaldehyde Resin Solution for captive consumption. The Tribunal held that the refund claim cannot be rejected solely because the price list was not challenged in appeal. The matter was referred back to the Assistant Collector for reconsideration based on the facts and Section 11B of the Act. (Case Citation: 1997 (12) TMI 435 - CEGAT, New Delhi)
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1997 (12) TMI 434
The judgment by the Appellate Tribunal CEGAT, Madras involved the classification of goods described as chain sprockets under tariff headings. The lower appellate authority classified the goods under heading 8485.90, but the importer claimed assessment under heading 8433.40. The tribunal ruled that chain sprockets are covered under Tariff Heading 8483.40, not excluded as argued by the lower appellate authority. They relied on the HSN and dismissed the appeal of the Revenue while granting relief to the importer under Tariff Heading 8483.40.
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1997 (12) TMI 433
The appellants, engaged in manufacturing footwear, claimed exemption under Notification No. 66/87 for Rubber Sole Sports Shoes. Authorities denied exemption due to plastic logo on shoes. Tribunal disagreed, stating the presence of plastic logo does not make uppers plastic. Impugned orders set aside, appeal allowed.
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1997 (12) TMI 432
The Appellate Tribunal CEGAT, Mumbai ruled on a case involving excisable goods and Small Scale Industries exemption. The Department demanded duty from the Respondents for exceeding the clearance value of Rs. 30 lakhs collectively for two headings. The Asstt. Commissioner granted a refund, but the jurisdictional Commissioner filed a review application. The Commissioner (Appeals) dismissed the review application citing Section 35A(b) of the Central Excise Act, 1944. The Tribunal remanded the matter for fresh consideration in light of Sections 35E and 11A, setting aside the impugned order and instructing the Commissioner (Appeals) to give a hearing to the Respondents.
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1997 (12) TMI 431
Issues Involved:
1. Legality of the search and seizure.
2. Confiscation of gold biscuits.
3. Confiscation of foreign currencies.
4. Confiscation of Indian currency.
5. Validity of retracted statements.
6. Authority to issue search authorization.
7. Cross-examination of witnesses.
8. Evidence supporting the possession and acquisition of confiscated items.
Detailed Analysis:
1. Legality of the Search and Seizure:
The appellants argued that the search was illegal as it was authorized by a Superintendent, who is not empowered under Section 105 of the Customs Act, 1962. The Tribunal noted that Notification No. 11/70, dated 31-1-1970, authorized a Superintendent to issue search warrants in the absence of his Assistant Commissioner at headquarters. Citing the Supreme Court's decision in the case of State of Maharashtra v. Natwarlal Damodar Das Soni, it was held that even if the search was illegal, it would not vitiate the seizure of the articles or subsequent investigations and trial. Thus, the Tribunal concluded that the search was valid and justified.
2. Confiscation of Gold Biscuits:
The appellants claimed that the gold biscuits were legally imported and belonged to Shri K.N. Babu, who had given them to M/s. Ashish Jewellers, who in turn gave them to Shri Ramesh Khatnani for conversion into Kundan jewellery. However, the Tribunal found no immediate affidavits claiming ownership of the gold biscuits were filed with the seizing Customs Authorities. The Tribunal also noted that Shri Ramesh Khatnani's records did not show any substantial history of undertaking such conversion jobs. The Tribunal held that the baggage receipt did not cover the confiscated gold biscuits and that the appellants failed to discharge the burden of proof under Section 123 of the Customs Act, 1962, which shifts the burden to the appellants to prove that the gold biscuits were legally acquired.
3. Confiscation of Foreign Currencies:
The appellants argued that Customs had no authority to confiscate foreign currency and that the currency was properly accounted for. However, the Tribunal noted that foreign currency was recovered from concealed places, including the pant pocket of Shri Ramesh Khatnani, which indicated illegal possession. The Tribunal upheld the confiscation of foreign currencies under Section 111(d) of the Customs Act, 1962.
4. Confiscation of Indian Currency:
The appellants contended that the Indian currency of Rs. 11,10,000/- was part of their genuine business transactions and was recorded in their Bahi Khata. However, the Tribunal found the records insufficient to prove that the currency was not the sale proceeds of smuggled gold. The Tribunal noted that the known professions of Shri Ramesh Khatnani, such as changing torn notes and running a PCO, did not justify possession of such a large amount of cash. The Tribunal concluded that the Indian currency was indeed the sale proceeds of smuggled gold.
5. Validity of Retracted Statements:
The appellants argued that the statements recorded under Section 108 of the Customs Act, 1962, were not voluntary and were retracted. The Tribunal found that the retraction of the statement dated 20-12-1993 was received on 6-1-1994, casting doubt on its authenticity. The Tribunal held that the retraction was an afterthought and upheld the original statements as credible evidence.
6. Authority to Issue Search Authorization:
The Tribunal upheld the search authorization issued by the Superintendent, citing Notification No. 11/70, dated 31-1-1970, which permits a Superintendent to issue search warrants in the absence of his Assistant Commissioner. The Tribunal also referenced the Supreme Court's ruling that an illegal search does not invalidate subsequent seizures and investigations.
7. Cross-Examination of Witnesses:
The appellants argued that they were denied the opportunity to cross-examine certain witnesses. The Tribunal found that cross-examination of key officers was allowed and that the denial of cross-examination of Panch witnesses did not prejudice the appellants' case. The Tribunal cited the Supreme Court's decision in Surjeet Singh v. Union of India, which held that denial of cross-examination does not amount to denial of natural justice if it does not prejudice the case.
8. Evidence Supporting the Possession and Acquisition of Confiscated Items:
The Tribunal found that the appellants failed to provide plausible and acceptable evidence to support the legal possession and acquisition of the confiscated gold biscuits, foreign currencies, and Indian currency. The Tribunal noted that the appellants' explanations were not convincing and were inconsistent with the evidence on record.
Conclusion:
The Tribunal upheld the confiscation of 8 gold biscuits, 1,067 US Dollars, 15 Singapore Dollars, and Indian currency of Rs. 11,10,000/-. The Tribunal also upheld the penalties imposed on Shri Ramesh Khatnani and Shri Ashok Khatnani. The appeals were rejected, and the impugned order was confirmed.
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1997 (12) TMI 430
Issues:
- Personal penalty under Rule 209A of the Central Excise Rules, 1944 levied on various individuals.
- Involvement of individuals in duty evasion.
- Abetment charges under Rule 209A.
- Retraction of inculpatory statements.
- Benefit of doubt for certain appellants.
- Active role of individuals in transactions.
Analysis:
The judgment deals with appeals arising from a common order where various individuals were levied personal penalties under Rule 209A of the Central Excise Rules, 1944. The appellants, including dealers and bunk shop owners, were penalized for involvement in duty evasion related to non-duty paid biris. The Counsel for the appellants argued that the quantum of biris seized from them was minimal, and they were unaware of the duty status of the goods they dealt with. The Tribunal considered the appellants' status as petty dealers, their lack of knowledge about Central Excise formalities, and the small profits they made, ultimately giving them the benefit of doubt and setting aside the penalties.
In the case of two appellants found in possession of biris without duty payment, they initially gave inculpatory statements which were later retracted. The Tribunal noted a delay in the retractions and the lack of evidence showing coercion in giving the statements. The appellants' failure to maintain proper accounts and their assistance to the main offender were considered. The penalties on these appellants were reduced to Rs. 5,000 each, considering the circumstances and the quantum of goods involved.
Regarding the owner of a trading company dealing in biri leaves, the Tribunal gave the benefit of doubt based on discrepancies in statements and lack of verification of transactions by the department. The penalty on this appellant was set aside due to insufficient evidence linking them to duty evasion. Similarly, the penalty on an individual, who was the brother-in-law of the main offender and involved in transactions, was reduced to Rs. 10,000 considering his active role in the offenses.
The judgment emphasizes the importance of evidence, knowledge, and active participation in determining liability for penalties under Rule 209A. It highlights the need for clarity in statements, verification of transactions, and consideration of individuals' roles in duty evasion scenarios. Ultimately, the Tribunal granted the benefit of doubt in some cases while reducing penalties in others based on the specific circumstances and evidence presented.
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1997 (12) TMI 429
The application is for waiver of pre-deposit of Rs. 46.80 lakhs duty and penalty of Rs. 5,000. The dispute is regarding duty paid on rear view mirrors cleared with scooters and auto-rickshaws. The Tribunal grants waiver of deposit, asking the applicant to keep unutilized credit of Rs. 30 lakhs in Modvat account during the appeal. Compliance is required by January 19, 1998.
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1997 (12) TMI 428
Issues:
Dis-allowance of Modvat credit on Low Sulphur Heavy Stock (LSHS) and furnace oil used in DG Sets for electricity generation for electrolysis process.
Analysis:
The judgment involves three appeals challenging the dis-allowance of Modvat credit on LSHS and furnace oil used in DG Sets for electricity generation. The Collector disallowed the credit, stating that electricity is not considered a good or intermediate product for Modvat purposes. The Collector noted that the power generated was not exclusively used for the final product but also for other purposes in the plant. The Collector emphasized that prior to Notification No. 11/95, inputs used for electricity generation in DG Sets were not eligible for Modvat credit.
The appellants argued that petroleum products like furnace oil and LSHS were covered under Rule 57A, making them eligible for Modvat credit. They contended that the electricity generated was mainly used in the electrolysis process for manufacturing caustic soda, an intermediate product. The appellants highlighted that electricity was considered a good under the tariff and that amendments to Rule 57A and 57D allowed credit for electricity generation within the factory for any purpose.
In contrast, the Departmental Representative referred to a Tribunal decision where fuel oil used for electricity generation was deemed ineligible for Modvat credit as it was not directly related to manufacturing the final product. Due to conflicting decisions among Tribunal benches, the Departmental Representative suggested referring the matter to a Larger Bench.
The Tribunal acknowledged the inconsistency in Tribunal decisions regarding the admissibility of fuel oil used for electricity generation as a Modvat credit input. Consequently, the Tribunal agreed to refer the issue to a Larger Bench for resolution. The matter was directed to be placed before the Honorable President for further action.
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1997 (12) TMI 427
The case involves the manufacture of steel forgings, which were considered waste and scrap due to manufacturing defects. The duty demand was confirmed for not seeking permission to transfer goods to Waste and Scrap account. The Commissioner accepted that the goods were waste and scrap, not forgings. The duty demand was not sustainable, and the appeal was allowed. (1997 (12) TMI 427 - CEGAT, NEW DELHI)
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