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Central Excise - Case Laws
Showing 261 to 278 of 278 Records
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2016 (9) TMI 80
Demand - clandestine manufacture and removal of plywood without payment of duty during the period 1998-99, 1999-2000 - non-accountal of basic raw materials for manufacture of plywood, namely the face veneers and the core veneers - Held that:- in the assessee's own case for different period on the show cause notice issued on very same allegation, the Tribunal after analysing the facts, evidence and law in detail has held the issue in favor of assessee - Therefore by following the decision laid in the assessee's own case, we are of the view that the demand is not sustainable. The impugned order is set aside. - Decided in favour of appellant with consequential relief
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2016 (9) TMI 79
Restoration of appeals - earlier dismissed for want of clearance from the Committee of Secretaries in 2006 - COD was received in May 2007 and appellant in end of 2014 ie., after more than 7 years of obtaining COD prayed for restoration of appeal as the appellants have now produced the COD clearance - no reason explaining the delay in filing the appeal even after obtaining the COD has been put forward by appellant - Held that:- reasonable delay, and that too satisfactorily explained with reasons thereof can be grounds for favourable consideration of applications for restoration of appeal. Indigent condition of the appellant or the appellant being a small proprietorship firm or even an SSI may also be grounds for condoning the delay and acceding to the restoration of appeal. But in the instant case the appellant is a huge Public Sector Undertaking undeniably having sufficient manpower and other organizational infrastructure and facilities. This being so in our view, such enormous delay, that too unexplained even after giving opportunity for the same borders on the callous. As the appellant PSU having slumbered for so long cannot now wake up and obtain restoration of the appeal. This is precisely what the doctrine of laches propounds. Based on the maxim “vigilantibus et non dormientibus jura subviniunt” – The law aids the vigilant, not those who slumber on their rights. - Decided against the appellant
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2016 (9) TMI 78
Modvat credit - rejected without properly examining - Held that:- the Tribunal while remanding the case for denovo adjudication had observed that issue with reference to Modvat Credit has not been examined properly and had directed the quantification of duty amount payable by appellant. In the denovo adjudication we find that lower authority has glossed over the submission of the appellant that the seized invoices/documents required by them for putting forward a defence have not been supplied by DGCEI. The adjudicating authority has then given the cryptic order without quantifying the duty amount payable as directed by the Tribunal. The lower authority has merely ended with rejection of Modvat Credit without any order for duty to be recovered and fine and penalties to be imposed. Therefore, as the lower authority has merely ended with rejection of Modvat Credit without any order for duty to be recovered and fine and penalties to be imposed, the impugned order is set aside and the matter is remanded to the adjudicating authority for denovo consideration. - Appeal allowed by way of remand
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2016 (9) TMI 77
Cenvat credit - service tax paid on the Commercial and Industrial Construction Services by the service provider while constructing the Pant Nagar plant of appellant - Pant Nagar plant is paying excise duty on the goods which are deemed to be manufactured by them in their plant - Held that:- it is found that the Commissioner (Central Excise & Service Tax), LTU, has not examined the issue completely and in proper perspective. Therefore, the issue needs reconsideration by the Commissioner as regards various claims of the appellant. - Appeal allowed by way of remand
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2016 (9) TMI 43
Allowability of discount - removal of goods did not involve sale - assessee failed to produce the documents to arrive at the correct assessable value and had acted as an agent of the principal - Held that:- it is found that quantity of P or P medicine cleared from there as quantitative discount was known at the time of clearance of the goods at the factory gate. Also it is pertinent to note that the original adjudicating authority has observed that in respect of the same unit, for the earlier period, the Assistant Commissioner has held that job worker cannot be held to have acted as an agent/hired labour of the principal manufacturer or with agreement on principal to principal basis. Further, for the earlier period, the Assistant Commissioner has held that the method of valuation were in accordance with the Circular issued by the CBEC. The learned Assistant Commissioner by following the earlier view dropped the demand in the show-cause notice. On appeal by the department the learned Commissioner(Appeals) without any basis has held that there is no sale involved in this transaction and transaction was not on principal to principal basis and wrongly set aside the order-in-original.
Therefore, we hold that the appellants have discharged their duty liability on the value arrived at in accordance with the well settled principles of law enunciated by the Hon’ble Supreme Court in the case of Ujagar Prints Pvt Ltd Vs UOI [1989 (1) TMI 124 - SUPREME COURT OF INDIA]. Since the appellant has already paid the duty on the entire quantity cleared, which include free supply quantity and now demanding duty again on quantity discount would tantamount to subjecting the goods to duty twice, which is not permitted by law. - Decided in favour of appellant
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2016 (9) TMI 42
Cenvat credit - rejected/returned goods - credit took on the RBA series invoices and linked to their own original invoices reference - invokation of extended period of limitation - Held that:- wherever the appellant has been able to produce the documents correlating the return of the goods, he has been given benefit of the same and wherever the appellant has not been able to produce any document to substantiate their claim of return of the goods to the assessee as ordered by the Tribunal and the Commissioner (Appeals) and based on copies of the RBA invoices, this could not be established or proved that the goods were actually received by the appellant. Further, the extended period has rightly been invoked as the appellant has suppressed the facts from the department that he was availing credit on the RBA series of invoices. - Decided against the appellant
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2016 (9) TMI 41
Demand - duty on difference between finished goods reported in their 3CD returns and the RG-1 daily stock account - less quantity of clearance has been shown in their ER-1 returns as compared to the quantity of sale mentioned in the Balance-sheet - Held that:- it is obvious that the criteria for recording sales production etc. in the Balance-sheet significantly different from that required in ER-1. In the present case, the appellants have produced a reconciliation figures which show the variance was on account of trading, labour charges and some short quantity received. The same has not been challenged. Therefore, by following the decision of Tribunal in the case of Composite Boards (P) Ltd. [2009 (7) TMI 410 - CESTAT, CHENNAI], where in similar circumstances relief was granted, the impugned order is set aside. - Decided in favour of appellant
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2016 (9) TMI 40
Remission of duty payable on 4082 MTs of molasses - deteriorated due to auto-combustion and ultimately became unfit for consumption - Held that:- the issue is no longer res integra and stands covered by the judgement of the Hon’ble Allahabad High Court rendered in the case of CCE Allahabad Vs Balrampur Chini Mills Ltd. [2005 (7) TMI 30 - HIGH COURT ALLAHABAD]. The appellant had taken all pre-cautionary steps that can be taken and it was only due to excessive production and generation of molasses that State Government had not given permission to clear the said molasses; that the quantity under dispute became unusable which was destroyed and there was no dispute to the fact that the goods were unfit for human consumption. It is also found that, the molasses was susceptible for deterioration due to auto-combustion and due to long storage of molasses in the masonry tank, it quickly deteriorated and became unfit for consumption. Therefre, the impugned order is liable to be set aside and consequently the rejection of remission of duty by the adjudicating authority besides imposition of penalty of ₹ 1 lakh and the demand of interest are set aside as unsustainable in law. - Decided in favour of appellant
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2016 (9) TMI 39
Invokation of extended period of limitation - Demand of duty alongwith interest and penalty - appellant procured certain inputs from 100% EOU - credit of duty availed in excess of additional duty leviable under Section 3 of the Customs Tariff Act equivalent to duty of excise specified in Clauses (i) (ii) (iii) (iv) (v) (vi) (via) of Rule 3(1) of CCR, 2004 is irregular.
Held that:- the duty charged by an EOU is a duty of excise charged by 100% EOU and the amount of duty charged is one single amount and does not contain any bifurcation as to basic custom duty, additional duty of customs, etc. It is found that the invoices issued by the 100% EOU indicate excise duty as per the proviso to Section 3(1) of the Central Excise Act where only Central Excise duty has been prescribed to be calculated in a particular manner. It is also found that Revenue was wrong in further bifurcating the Central Excise duty paid into basic custom duty and education cess. Though the method used for calculating the measure of such excise duty was also to include element of customs duties but the entire duty paid on the invoices will have to be considered as Central Excise duty paid under Section 3(1) of Central Excise Act. Therefore keeping in view the various judgments cited which squarely covers the case of the appellant in his favour, the impugned order is set aside. - Decided in favour of appellant
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2016 (9) TMI 38
Recovery of Cenvat credit and interest - irregularly taken on inputs which resulted in double benefit to the appellant - appellant submitted that removal of inputs under Rule 4(5)(a) for processing and return cannot be construed as removal of inputs as such under Rule 3(5) - Held that:- after considering the provisions of Rule 3(5) and 4(5)(a) of the Cenvat Credit Rules 2004 and the judgments of the Tribunal in the case of Southern Lubrication (P) Ltd. Vs. CCE, Bangalore [2012 (1) TMI 106 - CESTAT BANGALORE], I am of the considered opinion that appellant's case is squarely covered by the said decision wherein it has been held that the removal of input or capital goods to a job worker for further processing, testing, repair, reconditioning or any other purpose is governed by Rule 4(5)(a) of the Cenvat Credit Rules, 2004. Therefore, by following the same, the impugned orders are set aside. - Decided in favour of appellant with consequential relief
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2016 (9) TMI 37
Extended period of limitation of five years - time barred demand - admissibility of Cenvat credit - MS Channels/Beams/Joists which are used for making support structures for the machinery/capital goods - Held that:- there were conflicting views given by the courts, during the relevant period, regarding admissibility of Cenvat Credit on the impugned items which was decided only by the larger Bench in the case of Vandana Global Ltd. v. CCE, Raipur [2010 (4) TMI 133 - CESTAT, NEW DELHI (LB)]. Appellant, therefore, had a bona fide belief that Cenvat Credit on disputed items was admissible. In the light of the above observations and the settled proposition of law it is held that extended period of five years is not applicable in the present case. - Decided in favour of appellant
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2016 (9) TMI 36
Demand of duty and imposition of penalty - clandestine removal of goods - received 238 triplicate and quadruplicate copies of invoices used by the Appellant firm to remove goods without payment of duty - no further investigation appears to have been conducted - Held that:- we find that in spite of possession of 238 invoices, no investigation was conducted to ascertain the veracity of those invoices. We further find that the department has not disclosed the source of such invoices. It is not forthcoming on record as to whether such invoices were seized from the buyers or from the possession of any employee or director or from the office/ factory of the Appellant. Even if the invoices were received by the department, the officers could have conducted investigation from the buyers of the goods or the transporters as number of transport vehicles were appearing in invoices, but no investigation was conducted. Only on the basis of statement of Shri Sukumar Ghosh, who had stated that it indicates removal of goods, duty liability cannot be fastened against the Appellant's firm. The preparation of 238 invoices at the utmost can create a doubt that the goods have been removed under the cover of such invoices, however the same has to be corroborated by conduction of further investigation from the buyers/ transporter and other persons involved. In absence of any such investigation, demand cannot be substantiated against the appellant.
In case of demand of ₹ 96,27,789/-, the same has arisen on the sole basis of statement of Shri Nizzamuddin Sheikh who has stated that the production of Sponge Iron was 1600 MT per month. We find that his statement is not supported by any evidence. No documents in the form of his production register or wage record or any production report are available on record for substantiating his statement. Once Shri Sukumar Ghosh in his statement dated 27.05.2008 had stated that his earlier statements were based upon records shown to him, the investigation officers should have brought on record of clearance of goods from the factory of Appellant firm with enquiries from buyers, transporters and the employees/ persons connected with the case. No such evidences or statements have been brought on record. In such case, we are of the view that demand cannot be made on the basis of statement of Shri Sukumar Ghosh or Shri Nizammuddin Sheikh. Also in case of demand based upon statement of Shri Nizzamuddin Sheikh, we find that apart from his statement no other documentary evidences are available on record. We, therefore hold that the demand of ₹ 95,28,055/- and of ₹ 96,29,789/- are not sustainable.
In case of demand of 34,86,045/- on the basis of Process Department Log Book and Shift Log Sheet, the demand has been made on the basis of alleged consumption of raw material. We find that Shri Sukumar Ghosh and the Directors of the Appellant firm have pleaded ignorance about such documents. No identification of person who has prepared said documents has been done. In absence of scribe of such documents, the investigation does not lead to inference of having goods produced in the Appellant's Factory. No evidence of Appellant firm having procured the unaccounted raw material has come to the light. Nevertheless, we find that on the basis of such documents showing consumption of raw material, it cannot be said that the goods have been manufactured and cleared by the Appellant. We, thus hold that the duty demand is not sustainable in view of various judgments.
Demand of ₹ 13,10,287/- and ₹ 2,58,764/- - on the basis of Despatch Advice and slip pad. Shri Sukumar Ghosh in his statement dated 27.05.2008 denied any knowledge about such papers. The adjudicating authority in his order has only held that the charges are established on the basis of documents. We find that no discussion has been done as to how the said records lead to inference of removal of goods. In absence of buyers of goods, transportation thereof and receipt of consideration, the charges of clandestine removal cannot be established. No effort has been undertaken to identify the author of said dispatch advice and slips pad. Thus, the demands cannot be made. Therefore, the demands are not sustainable.
A demand of ₹ 14,94, 236/- has been confirmed against the Appellant firm on shortages of MS Ingots found during physical verification on 14.02.2007. We find that the denial of cross examination of Shri Sukumar Ghosh who was present at the time of physical verification has been wrongly denied. That they have been recording the production on estimation basis which has led to such shortages. That since there are no corroborative evidence of removal of goods, therefore demand is not sustainable. We find that except shortage, no other evidence has been brought on record concerning the removal of goods. The shortages of goods may lead to an inference of removal of goods without payment of duty and a starting point of investigation. However, no further investigation has been conducted to ascertain the material fact of removal of goods. Since there is no buyer of goods and no investigation on removal of goods, in such a case we hold that duty demand is not sustainable merely on the basis of shortages of goods. Hence, the impugned order is not sustainable and are set aside. Since we have held that there is no sustainable demand, consequential penalties on Shri Sukumar Ghosh and Shri Iqbal Razzak Hingora are also set aside. - Decided in favour of appellant with consequential relief
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2016 (9) TMI 35
Capital goods CENVAT credit - HR Plates, MS Beams, Hot Rolled Plates, MS Billets - used for constructing the chimney attached to the furnace - Held that:- by following the decision of Hon'ble High Court of Chhattisgarh in the case of Union of India Vs. Associated Cement Company Ltd. [2010 (10) TMI 550 - CHHATTISGARH HIGH COURT] where credit has been allowed on steel material used in the fabrication of chimney for Diesel Generating set, the credit of steel material used for fabrication/construction of chimney is admissible as CENVAT Credit.
Cenvat credit - Asbestos Cement Sheets - used for construction of roof of the factory - Held that:- by following the decision of Hon'ble High Court of Allahabad in the case of M/s. Daya Sugar Versus Commissioner, Central Excise, Meerut-1 [2014 (10) TMI 722 - ALLAHABAD HIGH COURT], the credit of asbestos sheet is not admissible.
Refund claim - matter concerning admissible of credit is not finalized - refund is premature - Held that:- the Tribunal has finalized the admissibility of credit, therefore, I set aside the order of rejection of refund claim and direct the original adjudicating authority to grant consequential relief. - Decided partly in favour of assessee
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2016 (9) TMI 34
Demand and redemption fine in lieu of confiscation - duty on difference between closing stocks recorded in the Balance sheet of the year 2006-07, 2007-08 and 2008-09 with reference to the closing stock reported in the ER-1 returns - Held that:- it is found that the demand is solely based on comparison of the data of financial accounts appearing in the Balance-sheet with ER-1 returns. The appellants have contended that the stage at which the goods are recorded as finished goods in the Excise records is different from the stage at which the goods are recorded in the financial records. There is no other evidence of clandestine removal produced by the Revenue. Moreover the closing balance of one year in the financial record is appearing in the opening balance in the next financial year. In these circumstances, I find that there is no evidence whatsoever to sustain the demand of duty and redemption fine in lieu of confiscation. - Decided in favour of appellant
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2016 (9) TMI 33
Imposition of penalty - credit taken on the strength of invoice received from M/s. Nakoda Trading Corporation has been denied - M/s. Nakoda Trading Corporation had not received the imported goods at all - sale of imported goods to the appellants and the countervailing duty paid on the imported goods was transferred to the appellant by issue of invoices, on which the appellant had taken the credit - Held that:- it is found that earlier in the case of another noticee in the same proceedings, namely, Shri Satish Agarwal, Partner of M/s.Time & Space Haulers, against whom penalty was dropped by the impugned order, the Revenue had withdrawn the appeal by filing a miscellaneous application. The said appeal was allowed to be withdrawn, as the amount of penalty was below the threshold limit prescribed in the litigation policy. In the case of Shri Pradeep Gaur, the facts are identical and the penalty imposed is ₹ 2.00 lakhs which is below the threshold limit prescribed in the litigation policy. In view of the above, the appeal filed by the Revenue in the case of Shri Pradeep Gaur is dismissed.
Invokation of extended period of limitation - Demand - credit taken during 2005 has been raised in 2010 - Held that:- the order-in-original does not record any ground for upholding the extended period of limitation and also does not examine the documents submitted by the appellants to establish that they have indeed received the goods. In the impugned order also no suppression mis-declaration or fraud on the part of the appellant has been pointed out. No statements or other evidence has been shown to indicate any role of the appellant in the alleged fraud. The impugned order does not dispute that goods have been received by the appellants along with the said invoice. Therefore, in the absence of any specific allegation of mis-declaration, suppression, fraud or collision on the part of the appellant extended period of limitation cannot be invoked against the appellants. The demand is therefore set aside as barred by limitation. - Decided in favour of appellant
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2016 (9) TMI 32
Refund claim - duty paid on differential value - supply of electrical transformers and accessories at contracted price containing a price variation formula - price reduced subsequent to the clearance of goods - Held that:- by following the various decisions of Supreme Court and Tribunal the respondents are not entitled to refund. Since the respondents are not entitled to refund the duty paid on differential value calculated by revising the assessable value, hence the question of unjust enrichment or otherwise become irrelevant. - Decided in favour of Revenue
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2016 (9) TMI 31
Invokation of extended period of limitation - Demand for the period 21.05.1991 to 24.07.1996 - no suppression of facts or any wilful misrepresentation - utilization of duty-free molasses received under Chapter X procedure in the manufacture of cattle feed as per the declaration - Held that:- in all fairness the matter should be remanded back to the adjudicating authority to decide the matter afresh. We find that there are not many documents placed before us although the counsel for the appellant submitted photocopies of the index that was filed by them before this Tribunal in their previous round of litigation. We, accordingly, remand the matter to the adjudicating authority who shall look into all the aspects. It is needless to mention that the learned Commissioner shall pass an order after taking into account all the facts and circumstances of the case. - Appeal allowed by way of remand
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2016 (9) TMI 30
Exemption from excise duty - Notification No. 23/2003 CE dated 31.03.2003 - egg shell waste - Held that:- the issue is settled in favour of the appellant assessee. by following the ratio of decision of he Tribunal in the case of M/s. SKM Egg Products Export (India) Ltd. Versus Commissioner of Central Excise, Coimbatore [2013 (11) TMI 991 - CESTAT CHENNAI] wherein it was held that egg shell waste is a waste from Food Industry and it is exempted from excise duty as per Sl.No. 21 of Notification No. 23/2003 CE, the impugned order is set aside. - Decided in favour of appellant
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