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Central Excise - Case Laws
Showing 41 to 60 of 375 Records
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2015 (11) TMI 1587
Classification of goods - rubber blined hose pipes and flexible hose piping - classification under CSH-4001.00 of Central Excise Tariff Act 1985 or under CH 40.05 - Held that:- issue of classification is squarely settled against the appellant by the judgment of the Apex Court their own case. The appeal which contested the classification of the product rubber solution was rejected to that extent and it was held that the product in question “rubber solution” is classifiable under chapter no. 40.05, hence there is no question of deciding the classification issue.
Eligibility of benefit of N/N. 377/86-CE - any product which is falling under chapter no. 40.05 is to be extended the benefit of concessional rate of duty i.e. 15% - for the period October, 1986 to February 1987, the appellant are eligible for notification no. 377/86-CE, in respect of the product “rubber solution” of CTH-40.05. The duty liability for the period needs to be recalculated and appellant is directed to discharge the duty liability.
Duty liability on appellant for the period March, 1987 to May, 1988 - rubber solution consumed in the manufacture of the final products in the same factory of the appellant, which classified under the said chapter no. 59, was added as eligible for the goods N/N. 217/86-CE & no. 82/87-CE dated 1/3/1987. since captive consumption is exempted, no duty liability arises for the period from March 1987 to May 1988.
Appeal disposed off - decided partly in favor of appellant.
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2015 (11) TMI 1586
Denial of CENVAT credit - repair and maintenance of residential colony - input service - whether denial justified on the ground that the said service has no nexus with the final product manufacture by the appellant? - Held that: - the appellant had made specific submissions before the authorities below that the cost towards repair and maintenance of residential colony including the service tax component thereon have been considered in arriving at the assessable value for determination of the Central Excise duty liability. For the period April 2010 to 31st March, 2011, the appellant should be eligible for cenvat benefit on the service tax paid on repair and maintenance of residential colony in view of the un-amended definition of 'input service', where the phrase “activity relating to business” was finding a place for the purpose of getting the cenvat benefit.
Extended period of limitation - Held that: - the show cause notice was issued beyond the normal period of limitation of one year, which is barred by the limitation of time, in as much as, there is no element of suppression, fraud, wilful mis-statement etc., wherein Cenvat credit was allowed on input service used for construction of residential colony near the factory.
The certificate issued to the appellant clearly states that cenvat credit can be taken on the disputed invoice. Since the service tax has been paid on the disputed service and the same has been taken by the appellant and there is no specific allegation that cenvat benefit on account of the said invoice has been fraudulently taken by the other unit, denial of cenvat credit especially upon regularization of the matter by the Jurisdictional Central Excise Authorities, will not be detrimental to the interest of the appellant.
The embargo created in Rule 9 of the Cenvat Credit Rules should not be applicable for denial of the cenvat benefit.
CENAVT credit allowed - appeal allowed - decided in favor of appellant.
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2015 (11) TMI 1585
Service Tax under the category of Intellectual Property Right service - Assessee are the Brand Owner of IFML and M/s. Pilkhani is a job worker manufacturing IMFL on behalf of the assessee and the amount retained by the assessee is the business profit not liable to be taxed under the Finance Act, 1994 under the category of Intellectual Property service
Apex Court dismissed the revenue appeal against the order of tribunal [2015 (6) TMI 586 - CESTAT NEW DELHI] as devoid of any merit, dismissed - decided in favor of assessee.
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2015 (11) TMI 1581
Valuation - intermediate products manufactured and consumed further by the respondent-assessee - short-discharge of duty due to improper application of Rules and not arrived at the correct assessable value based upon CAS-4 for the period April - May, 2002 - Demand - Held that:- it is found that on the very same issue, this bench has remanded the matter back to the adjudicating authority. Therefore, by applying the same finding, we set aside the impugned order and remand the matter back to the adjudicating authority for following the directions of this Tribunal and arrive at the duty liability for the period in question in this appeal.
Imposition of interest and penalty - Held that:- it is found that the bench in the very same judgment has held that in case, respondent-assessee fails to produce details as per CAS-4, short-levy as proposed in the show cause notice will stand confirmed. No penalty under Section 11AC/Rule 173Q/Rule 25 will be impossable. Therefore, since the bench in identical issue has directed not to impose penalties the very same order will be applicable in this case also. Accordingly, the adjudicating authority, after arriving at the short-duty paid by the assessee, if any, will confirm the same along with interest as per the directions of the Tribunal’s order. - Appeal disposed of
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2015 (11) TMI 1580
Valuation - Synthetic Organic dyes captively used in the manufacture of formulation of dyes - addition of profit margin for arriving at assessable value based upon the provisional balance sheet - adjudicating authority has not followed the board circular no. 258/92-96-cs 13-10-1996 while fixing the assessable value - Held that:- I observe that profit before tax on sales of previous year has to be considered while working out the percentage of profit to be added to cost of production in the instant case, since the figures of profit before tax for the relevant year are available from balance sheets for the relevant years, I propose to take the figures of the relevant year for computation of profit margin instead of taking previous year’s profit, as directed in the said circulars.
The Dept adopted the method of working out assessable value/margin of profit as follows: cost of concentrated dyes + excise duty on concentrated dyes + cost of formulation = cost of manufacture of formulated dyes; selling price of formulated dyes - cost of manufacture of formulated dyes = manufacturing profit of formulated dyes. In this connection, I am inclined to agree with the notice’s contention that the assessable value/cost of production of concentrated dyes ought not to be worked out on the basis of selling price of formulated dyes.” In grounds of appeal, revenue has not come with any evidence which is contrary to the findings of the adjuicating authority. Therefore, the adjudicating authority was correct in coming to such a conclusion as in the impugned order and we hold that the impugned order is correct to the extent contested before us by the revenue is correct and does not require any interference. - Decided in favour of Revenue
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2015 (11) TMI 1574
Pre-deposit - appellants were directed to pre-deposit ₹ 19,75,099/- and ₹ 2 lakhs respectively and to report compliance on 8.9.2015 - no compliance filed - notice of dismissal of appeals issued to appellants and copy of order served to the address mentioned in the OIO but none found there and orders are returned. - Appeals dismissed for non-compliance of pre-deposit.
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2015 (11) TMI 1569
Cenvat demand - inputs received in the factory under the cover of Central Excise invoices, were not the same which were removed from the factory - appellant's claimed that inputs removed as such from the factory under Rule 3(5) of the Cenvat Credit Rules, 2004 - Held that:- the matter should go back to the original authority for a proper verification of the documents of the inputs. If the documents show that the inputs were not removed as such, but were removed after processing of inputs, then the duty demand already confirmed shall hold good. - Matter remanded back and appeal disposed of
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2015 (11) TMI 1560
Cenvat credit - PE/PVC compound granules - supplier of inputs have not manufactured the goods - Held that:- the supplier has paid the duty on the raw material procured by the appellant and appellant have also paid duty to the supplier of the goods. As per Rule 3 of the Cenvat Credit Rules, 2004 the assessee who procures inputs on payment of duty, is entitled to take Cenvat credit on the same. Therefore, Rule 3 of the Cenvat Credit Rules, 2004 mandates that when appellant has suffered duty, appellant is entitled to take Cenvat credit. Hence, the appellant has correctly availed Cenvat credit on duty paid inputs. Further, the appellant have no concern whether supplier has manufactured the inputs or not and the adjudicating authority cannot proceed against the appellant to deny Cenvat credit in such a case. - Decided in favour of appellant
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2015 (11) TMI 1559
Admissibility of appeal - Value of appeal is less than ₹ 2.00 Lakhs - Held that:- Since the value of appeal is very meager which is less than ₹ 2.00 Lakhs, in terms of the Second Proviso to Section 35B of the Central Excise Act 1944, I do not find any valid ground to admit the appeal. - Appeal dismissed
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2015 (11) TMI 1555
Demand - duty alongwith interest redemption fine and equal penalty - unaccounted stock of impugned goods found, which was not accounted in the RG1 Register - appellant assessee is regularly paying excise duty on goods cleared - Held that:- the appellant assessee is regularly paying the excise duty on the goods cleared by them. In the present case, the paper was in reel form and were waiting for order confirmation from the customers for cross cutting into printing and writing papers of required sizes so as to call it as finished goods. There was no attempt on their part to clear any goods without payment of duty. Therefore, by respectfully following the ratio laid down by the co-ordinate Bench of this Tribunal, it is found that the seized goods were not ready for removal from the factory but waiting for order confirmation from the customers. For non-maintenance of record, penalty under the provision of Rule 25 is imposable. Therefore, the penalty is reduced under the said provision on M/s. Aaditiya Aswin Paper Mills Pvt. Ltd. to ₹ 2,500/- and the redemption fine is waived. - Decided partly in favour of assessee
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2015 (11) TMI 1554
Denial of small scale exemption to both units - clubbing of clearances - mutuality of interest in the business of each other - Held that:- there is no ban on the existence of more than one unit in a compound. Likewise, commonality of directors with stake in these several units is again not conclusive proof of mutuality of interest. Supply of goods from one to another, and even occasional financial accommodation, are not unusual features of business activities. Nor can common supervisory system be designated as out of the ordinary. One of the fundamental aspects that appear to have been brushed aside by both lower authorities is the factum of both appellants being limited companies. Such companies may have interest in each other through holding company pattern or group company structure. And such companies may have financial relationship with each other without bearing the stigma of subterfuge for deriving undue advantage of the benefits small scale exemption. This immunity has its origin in the accountability of a company to its shareholders and the status as an 'artificial person" which has neither greed nor the 'wherwithal to induige in a greedy conduct.
Crucial in any proceedings for clubbing is the existence of a principal and a dummy or dummies. The purpose of clubbing is to deny the independent existence of one or more entities on the ground that the subterfuge of physical segregation is intended to avail the benefit of small scale exemption. Consequently, only one of the entities proposed to be clubbed is to bear the burden of duties sought to be evaded thus. No evidence to fasten these roles on either of the two appellants has been brought put in the notices.
The decision to issue two notices followed by two independent proceedings highlight the lack of any investigation in that direction. Furthermore, even after finding reasons to club clearances of the two units, duty liability arises on the clubbed value of clearances to the extent that it exceeds the threshold prescribed for small scale exemption. The failure to identify the principal entity has, therefore, led to denial of this threshold exemption. Therefore, the entire proceedings from issue of notice till the impugned order to be tainted by lack of application of mind. - Decided in favour of appellant with consequential relief
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2015 (11) TMI 1553
Refund claim - Rule 5 of Cenvat Credit Rules, 2004 - supply of goods under International Competitive Bidding governed under the provisions of Foreign Trade Policy as deemed export - accumulated cenvat credit available in their books of accounts - Held that:- the issue is no more res-integra. In view of the decision of Hon'ble Gujarat High Court in the case of C.C.E. vs. NBM Industries [
2011 (9) TMI 360 - GUJARAT HIGH COURT] and also the decision of this Tribunal in the case of Apotex Pharmachem India Pvt. Ltd. vs. CCE, Bangalore [2015 (10) TMI 2353 - CESTAT BANGALORE], wherein it was held that the clearances made by one 100% EOU to another 100% EOU which are deemed exports are to be treated as physical exports for the purpose of entitling refund of unutilized Cenvat credit contemplated under the provisions of Rule 5 of the Cenvat Credit Rule, 2004. Therefore, the impugned order denying the benefit of refund to the appellants is not sustainable. - Decided in favour of appellant
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2015 (11) TMI 1552
Availment of Cenvat credit of service tax paid - Security Agency Service for its off-factory guest house and residential colony - no nexus between disputed service and final product manufactured - Held that:- the expenditure towards the disputed service have been included in the cost of production of the excisable goods, on which Central Excise duty liability has been discharged, I am of the view that same shall merit consideration as input service for the purpose of taking cenvat credit. However, since no documentary evidences to that effect were produced by the respondent before the lower authorities, I am of the opinion that the matter is required to be remanded back to the original adjudicating authority for verification of the documents/records maintained by the respondent to demonstrate that the cost of disputed service and the service tax paid thereon is forming a part of the cost of production of the finished goods on which Central Excise duty liability has been discharged. - Appeal allowed by way of remand
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2015 (11) TMI 1551
Imposition of penalty - Rule 209A of the Central Excise Rules - acquisition of water treatment Plant and their filing of declaration under Rule 57 T to avail credit on capital goods, which will be used in the manufacture of water treatment Plant, and as the activity amounts of manufacture - evasion of duty - Held that:- in the case of erection of water treatment Plant, this Tribunal have held, designing supplying the components and erecting the water treatment Plant at the site of assessee/appellant, the said activity is not leviable to Central Excise duty as the water treatment plant is immovable. In this view of the matter when the water treatment Plant itself is not taxable, there is no question of imposition of penalty on the appellant under the provisions of Rule 209A of Central Excise Rules, 1944. - Decided in favour of appellant
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2015 (11) TMI 1550
Cenvat credit - allowability - Cenvat credit taken prior to the receipt of goods - utilised Cenvat Credit not available on the date of utilisation - appellant deposited interest for 2 days on the Cenvat amount and intimated to the revenue on 16/9/11 prior to issue of the SCN - Held that:- so far invoice number 95 dated 25/9/07 is concerned, there is no material alteration in the gate register or on the body of the invoice. Accordingly the demand relating to this invoice is set aside along with the penalty imposed. So far the demand relating to Cenvat Credit for invoice numbers 50 and 51 dated 27/6/07 is concerned I find that the modvat Stamp is affixed in a different place in spite of there being space available at the usual place and secondly I find that there is material alteration in the gate register both in the serial number as well as the date in entry number 288 and 289. Thus manipulation is writ large on the face of the record. Thus, the demand in respect of invoice number 50 and 51 is upheld.
Period of limitation - Held that:- in such cases of manipulation and/deliberate avoiding the tax liability, I hold that extended period of limitation is available. Accordingly, the demand is held to be within time. - Decided partly in favour of appellant with consequential relief
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2015 (11) TMI 1539
Denial of CENVAT credit of service tax paid to avail the catering service for the factory - Held that:- Appellant availed catering service to discharge an obligation under the Factories Act. Therefore, there shall not be denial of CENVAT credit in respect of service tax paid to avail the catering service for the factory prior to 31.3.2011.
So far as the CENVAT credit in respect catering service availed after 1.4.2011 is concerned, in view of the specific provision in law, appellant is not entitled to the CENVAT credit. Appellant agrees to reverse the same. If such a reversal is made there shall be no interest and penalty, subject to availability of sufficient credit on record.
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2015 (11) TMI 1520
Seeking modification in the sentence order - Offence punishable under Section 55(a) - Seizure of spirit - Appellant contended that there is a difference in the number of the car in the forwarding note and in the Chemical Analysis Report. Also sample was taken only from one of the compartments and the non-production of the tube used for taking sample - Held that:- true, there is a slight difference in the number of the car in the forwarding note and in the Chemical Analysis Report. But the crime number is shown in the Chemical Analysis Report and so also it is stated that the sample seal forwarded tallied with the seal found on the sample bottle sent for analysis. The number shown in the Chemical Analysis Report can only be a clerical error. Even assuming that the articles were produced only on the next day, there is nothing to show that any prejudice has been caused or any tampering could have been done in the meanwhile.
PWs 1 and 3 have uniformly stated that the contents of all the compartments found in the car were identical and they did not feel that each of the compartments contain different liquids. In such circumstances, it is by now well settled that it is sufficient if the sample is taken from one of the bottles or one of the compartments as the case may be. This contention therefore too should fail. Therefore, the court has found that the defence set up is totally false. On an independent analysis of the evidence in the case, it is also found that story of the accused travelling in a lorry etc., are nothing, but a cock-and-bull story.
Seeking modification in the sentence order - Offence punishable under Section 55(a) - Seizure of spirit - Appellant contended that the sentence imposed is too severe and is disproportionate to the offence alleged to have been committed by the accused - Held that:- the antecedents and nature of the offence are relevant factors as regards sentencing policy is concerned. There is no antecedents or history of the accused having been involved in such transportation or carrying of contraband articles and nor after going on bail, he has done it again. Under these circumstances, it can be said that there is some substance in the contention of the appellant that some leniency may be shown with regard to the sentence. True, the crime is heinous and the consequences are drastic. Spirit flows and flows in Kerala. That has necessarily to be curbed. But in the process, the court shall not be carried away in the matter of sentencing an accused when situation warrants a lenient consideration. Since there is no antecedents shown as regards the accused and since it is felt that probably a proportionate term of imprisonment may reform him, it is felt that under the circumstances, some leniency can be shown in the matter of sentence. Therefore, while confirming the conviction of the accused for the offence punishable under Section 55(a), the sentence awarded is set aside. - Decided in favour of appellant
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2015 (11) TMI 1514
Refund claim rejected - commissioner has kept the appeal in “call book” - Held that:- Commissioner has kept the hearing of the appeal in abeyance sine die. This is presumably because the Department's appeal against the judgment of the Tribunal, which is in favour of the petitioner, is pending before the High Court. However, we notice that while admitting the appeal, the High Court has rejected the Department's stay application. When, thus, the Court refused to stay implementation of the judgment of the Tribunal, benefit thereof must flow in favour of the assessee who has succeeded. The action of the Commissioner in keeping the appeal against the order of the adjudicating authority refusing to grant refund would be an indirect attempt to deny the benefit to the petitioner flowing from such judgment of the Tribunal when the High Court refused to grant protection. The Commissioner by way of indirect method cannot bestow the same unto himself. Under the circumstances, the Commissioner shall withdraw the appeal from the Call Book and dispose of the same as directed. The petition is disposed of with these directions.
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2015 (11) TMI 1513
Demand of non payment of duty as per the provisions of Rule 8 (3) A of the Central Excise Rules, 2000 - Held that:- We hold that demand of duty under Rule 8(3A) is unsustainable as the said Rule has been struck down by the Hon'ble High Court and the demand of duty and penalty imposed in the impugned orders is liable to be set aside. See Cheran Cements Ltd. and Others Versus CCE Trichy and CCE Coimbatore [2015 (8) TMI 99 - CESTAT CHENNAI], Indusur Global Ltd. Vs. UOI [2014 (12) TMI 585 - GUJARAT HIGH COURT], Precision Fasteners Ltd.Vs. CCE [2014 (12) TMI 655 - GUJARAT HIGH COURT], Malladi Drugs & Pharmaceuticals Ltd. [2015 (5) TMI 603 - MADRAS HIGH COURT] and A. R. Metallurgical Pvt. Ltd. Vs CCE, Chennai [2010 (10) TMI 140 - CESTAT, CHENNAI] - Decided in favour of assessee
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2015 (11) TMI 1510
Cenvat credit on annual club membership fee denied - Held that:- If we see the definition of input service, we will find that the definition of input service is very wide. It covers not only services used directly or indirectly in or in relation to manufacture of finished products but also various services used in relation to business of manufacture whether prior to manufacture or after manufacture. Further, I also find that the club service is utilised to promote sales and purchase activity by attending the clients and holding conferences and such expenses are part and parcel of manufacturing cost of final product as held in the case of Mangalam Cement Ltd. (2015 (9) TMI 942 - CESTAT NEW DELHI ).
Adjudicating Authority has categorically held that mandatory penalty is not imposable under Section 11AC due to lack of suppression, fraud, collusion, wilful misstatement with intend to evade payment of duty. the period in dispute is 2005-07 and the show-cause notice was issued on 02.03.2009 which is clearly beyond the period of limitation and consequently when there is no suppression, fraud or wilful misstatement and collusion the extended period cannot be invoked. - Decided in favour of assessee
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