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Central Excise - Case Laws
Showing 41 to 60 of 278 Records
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2016 (9) TMI 1230
Invokation of extended period of limitation - Classification - Gloves, manufactured and used for sports - whether to be classified under Chapter heading No.9506 of Schedule to CETA, 1985 or under Tariff Item No.4203 2110 of said schedule - notification issued by Government of India for All Industries Rate of Drawback through which the goods manufactured by appellant, were shown to have been classifiable under Tariff Item No.950621 - Held that:- the show cause notice was issued by invoking proviso to Sub-Section 1 of Section 11A to Central Excise Act, 1944. The show cause notice was issued on 25.06.2013 and the period covered by the show cause notice, is from June, 2008 to February, 2012. For issue of show cause notice under extended period, separately it is to be established that the noticee has either suppressed information or miss-declared the information or contravened the provisions of Central Excise Law or Rules made thereunder, and separately, they had intention to evade duty. In the present case, we find that Government of India through their notification for All Industry Rate of Drawback classified the goods manufactured by noticee, under Tariff Item No.9506 21, and admittedly, the noticee have paid the Central Excise duty liable to be paid for the goods classifiable under Tariff Item No.9506 21. Therefore, Revenue could not establish that the appellants had intention to evade duty. We, therefore, hold that the show cause notice is hit by limitation. - Decided in favour of appellant
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2016 (9) TMI 1229
Cenvat credit - various iron and steel articles - steel items used in fabrication of capital goods and welding electrodes, Oxygen Gas and LPG Gas used in the manufacture of capital goods or for repair of the same - Held that:- without going into the factual aspect as to whether the iron and steel articles were used for construction or as supporting structurals, in view of the decision of Hon’ble Gujarat High Court in the case of Mundra Ports & Special Economic Zone Ltd. [2015 (5) TMI 663 - GUJARAT HIGH COURT] which is an over-ruled decision, held that the amendment issued on 07.07.2009 cannot be held to be clarificatory amendment and as such, would be applicable only prospectively, we are of the view that the same would be entitled to credit inasmuch as the period in the present appeal is before 07.07.2009.
Invokation of extended period of limitation - Demand - show cause notice stands issued on 30/09/2008, for the period, September, 2007 to December, 2007 - Held that:- the credit was being availed after reflecting the inputs in the statutory RG-23 D Part-I and Part-II records. The fact of availment of credit was also being reflected in the statutory returns being filed with the Revenue. Non-disclosure of a fact for which there is no column in the records or in the returns, does not ipso facto lead to the conclusion that such non-disclosure is with malafide intention, especially, when there is no legal obligation on the part of the assessee to disclose a particular fact. As such, it is well settled law that if during the relevant period, the decisions of the higher authorities are in favour of the assessee and the law was reversed only subsequently, by a Larger Bench or by any other decision, no malafide can be attributed to the assessee and longer limitation period would not be available to the Revenue.
As regards the welding electrodes and Oxygen Gas etc, we find that he issue again is no more res-integra and stand decided by various High Courts. One such refercne can be made to Chhattisgarh High Court in the case of Ambuja Cements Eastern Ltd. Vs. Commissioner of Central Excise, Raipur [2010 (4) TMI 429 - CHHAITISGARH HIGH COURT] wherein welding electrodes used for repair and maintenance purpose were also held to be cenvatable. Similarly, in the case of Hindustan Zinc Limted Vs. Union of India [2008 (7) TMI 55 - HIGH COURT RAJASTHAN], the Hon’ble High Court allowed the CENVAT Credit on the welding electrodes. By following said decision, we hold that the appellant is entitled to the credit. - Decided in favour of appellant with consequential relief
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2016 (9) TMI 1178
Demand of interest - Whether the interest is chargeable from the date of original adjudication order or from the date of issuance of the adjudication orders in de-novo proceedings, once the demand of duty was upheld by the Tribunal but only the quantum of duty was ordered to be re-adjudicated in de-novo proceedings - Held that:- Section 11AA of the Act provides that if an assessee fails to pay duty within three months from the date of determination, he is liable to pay interest thereafter. Explanation 1 and 2 thereof will not be applicable in the present case as in the case in hand the duty determined has not been reduced or increased by the appellate authority. Rather, it is a case where the Tribunal finding merit in the contention raised by the respondent remanded the matter back to the adjudicating authority for fresh determination of the amount of duty payable, which necessarily means that the impugned order had lost its significance and it is only the order passed after remand, which would be applicable and enforceable. Once in terms of the order passed by the adjudicating authority after remand by the Tribunal, there is no delay in deposit of duty by the respondent in view of Section 11AA of the Act, the demand of interest is not justifiable. - Decided against the Revenue
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2016 (9) TMI 1177
Clandestine removal of goods - Whether appellant was manufacturing Zinc Ingots for the entire period from 1996-1997 to 2000-2001 or started such Zinc Ingot manufacturing few days before the search - Held that:- the case of the Revenue is that appellant was manufacturing Zinc Ingots right from 1996-1997 as appellant had the Zinc Ingot making Bhattis all through. Appellant has taken a plea that Zinc Ingots cannot be manufactured from Zinc Ash/Dross. However, scientific literature produced by the Revenue during hearing before us do indicate that Zinc Ingots can be made out of Zinc Ash/Dross (Gaad). Statement of Shri Sunil Kumar Gupta partner of the appellant, clearly stated that he did not know the names and addresses of the persons who send them the material for processing. The challans under which materials are received indicate the processes of grinding and melting were required to be done and other processes of casting and sieving are scored off. The statement of Shri Deb Nath Bhattacharya (Accountant) of the appellant confirmed the rate of processing to be ₹ 1.50 per Kg. of material received and that ingot manufacturing started in the last few days.
Shri Prabir Hazra, Proprietor of M/s. Super Galvanizing Works in his statement dt. 31.08.2000 stated that he is getting Zinc Ingots manufactured out of Zinc Dross supplied from M/s. Sylvan Chemicals and also produced two challans dt. 22.07.2000 and 05.08.2000. However it is observed from copies of these challans that none of these were signed by Sri Prabir Hazra but have been signed by one Shri P.Samanta. Cross-examination of Shri Prabir Hazra was asked by appellant and the same was allowed by the Adjudicating Authority. Efforts were made by the Adjudicating Authority to call Shri Prabir Hazra but he did not turn up. A finding is given by the Adjudicating Authority that Shri Rohit Gupta, on behalf of the appellant during personal hearing on 06.01.2006, submitted that appellant would not make further request to call the cross examinees. However, it is observed from the record of personal hearing in Revenue s paper book that there is no concessions to the effect that cross-examination of witnesses will not be insisted. Rather the plea of Shri Rohit Gupta was to call Shri Hazra and Shri Bansal again which was accordingly ordered by the Adjudicating Authority in the record of the personal hearing. In view of the above statements of Shri Prabir Hazra and Shri Bansal cannot be relied upon against the appellant.
It is a well accepted legal proposition now that a statement has to be accepted as a whole and Revenue cannot pick and choose the portions of a statement favourable to them. It the entire statement of Shri Deb Nath Bhattacharya is accepted then Zinc Ingot manufacturing was started by the appellant in the last few days of seizure of Zinc Ingots. There is no other evidence indicating manufacture of Zinc Ingots from 1996-1997 to 1999-2000. Documentary evidences gathered by the investigating agency do raise suspicion but a suspicion howsoever grave cannot take the place of proof. Accordingly department's argument that all processing done by the appellant, for the relevant period, was only manufacturing of ingots, is not acceptable and is rejected. Further a case of clandestine removal cannot be based only on statements unless corroborated by other positive evidences.
Further even if it is assumed that appellant was manufacturing Zinc Ingots all through the period from 1996-1997 to 2000-2001 then also 100% yield cannot be obtained from Zinc Ash/Dross received by the appellant. Yield of Zinc Ingots will depend upon the percentage of metal content contained in Zinc Ash/Dross. It is also observed from the show cause notice that for the entire period 1996-1997 to 2000-2001 value of Zinc Ingots has been taken at a uniform rate of ₹ 65 per Kg. as per calculations made in Annexure I to the show cause notice. The method adopted is not reliable and logical in view of the fluctuating nature of market forces. Accordingly duty calculated and demanded in the show cause notice is not correct and legally not sustainable. Therefore, clandestine removal is not proved against the appellant.
Confiscation in lieu of redemption fine - 20.44 M.Ts of Zinc Ingots - Demand alongwith interest and penalty - Held that:- it was argued by the appellant that this quantity seized/confiscated will be eligible to small scale exemption. We are of the opinion that this aspect is required to be deliberated by the Adjudicating Authority in the light of this order as this claim was not made before the Adjudicating Authority. This issue regarding confiscation/duty payment with respect to 20.440 MT of seized Zinc Ingots is thus remanded to the Adjudicating Authority by setting aside order portion (i) of the OIO for denovo consideration after affording an opportunity of personal hearing to the appellant. - Appeal partly allowed and partly remanded
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2016 (9) TMI 1176
Whether stock-taking of goods manufactured by the Appellant has been correctly done by the officers of DGCEI and the Income Tax authorities to determine shortages and clandestine removal of goods - Imposition of penalty - Held that:- there is no other positive evidence on record that any finished goods have been cleared without payment of duty. Adjudicating authority has gone by the presumption that shortages of 1147.110 MT of Silico Manganese and 492 MT of Ferro Manganese calculated by the departmental/Income Tax authorities must have been clandestinely removed. It is now a well settled legal proposition that no case of clandestine removal can be held to be proved on the basis of presumptions, assumptions and surmises. Secondly, it has already been observed by us that stock taking done by the department is hypothetical and full of flaws. In the case of clandestine removals there should be positive evidence to indicate clandestine activity like seizure of finished goods in transit, purchase of extra raw materials, excess consumption of power etc.
In this present case before us even the Appellant has not admitted to have made any clearances clandestinely. The finished goods are cleared by the Appellant on actual weighment basis in containers/trucks and it is not the case of the Revenue that any less quantity is cleared by comparing final goods quantities shown in the clearance documents and the DSA quantity. In view of the observations and settled proposition of law, case of the department regarding clandestine removal is not sustainable against the Appellants, except shortage of 6.750 MT of Silicon Manganese admitted by the Appellants. So far as imposition of penalties upon the Appellants are concerned, it is observed that once clandestine removal case booked against the Appellants does not sustain then there is no point in imposing penalties upon the Appellants. Accordingly Appeals filed by the Appellants are required to be allowed, except to the extent contained in the next paragraph.
So far as shortage of 6.750 MT of Silico Manganese, in packed condition is concerned, Appellants in Appeal accepted this shortage. Further in their reply to the show cause notice, before the Adjudicating authority, also Appellant accepted this shortage. Order-in-Original, passed by the Adjudicating authority, is required to be upheld. This shortage of 6.750 MT of Silico Manganese is required to be accounted for in the DSA and liable to duty if not already accounted for. - Decided partly in favour of appellant
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2016 (9) TMI 1175
Valuation - captive consumption - Frequency or periodicity of costing in terms of CAS-4 - whether the CAS 4 based costing of Iron Ore Concentrate is to be done on an annual basis or for a lesser durations of 2/4/5 months, as and when the raw material costs varied - no sale of iron ore concentrate by the appellant - clearance to sister unit for further use is subjected to excise duty and valuation for such duty has to be worked out in terms of Rule 8 of Valuation Rules, 2000 - appellants followed different value during the same financial year based on revision of costing within the year more than once.
Held that:- it is an admitted fact that the appellants themselves did not follow costing to arrive at deemed transaction value for each clearance. They have considered a period of many months and worked out the costing, in terms of CAS-4 for that period and paid duty. Thereafter, they revised said costing when there are changes in raw material cost. That being the case, we find that the reliance placed by the appellant on the principle that time of removal is relevant and, hence, annual costing is not tenable, is unsustainable. The fact remains that while the duty liability has to be discharged at the time of removal of excisable goods in a situation where there is no sale transaction and known value, the deemed transaction value has to be constructed based on costing method which necessarily will involve an averaging of cost for a period, considering all the parameters. It is neither the case of the appellant nor there is such an approved standard for arriving at cost of excisable goods for each individual clearance.
When at the time of each clearance of excisable goods for captive consumption the exact transaction value could not be arrived at the relevant time the duty has to be paid on a provisional basis and upon arriving at the costing applying CAS-4 and the assessable value in terms of Rule 8 of Valuation Rules final determination of duty liability has to be made. In the present case, admittedly no provisional assessment was resorted to by the appellant. Hence, the determination of actual cost much later on the clearance resulted in certain adjustments and payments by the appellant.
Para 8 of guidelines issued by the Institute of Cost & Works Accountants of India on CAS-4 deals with periodicity of CAS-4 Certificates. On perusal of the guidelines by the ICAI, we find while arriving at costing based on CAS-4 the correct method will be to determine the same based on actual audited data as per the account year of the company. To that extend we find the CAS-4 cost price arrived at on annual basis by the Revenue is correct procedure.
Quantification of differential duty - duty paid in excess in certain months has been availed as credit by sister unit - time barred - Held that:- even though there is no provisional assessment in the present case, the duty determination on the inter-unit transfer is made on annual costing. As such when the Department arrived at cost on annual average basis the duty liability, excess or shortage has also to be determined on such basis. It is not tenable while for arriving at per unit duty liability the whole year data is considered for costing, for total duty liability only months when short payment was noticed were considered. In other words when CAS-4 based annual costing formed basis for arriving transaction value, the overall duty liability/short payment should be arrived at after considering duty already paid during that year on such goods.
We find the reasoning given by the Original Authority against adjustment of already paid duty as untenable. Section 11B has no application in such situation, when the appellants duty liability is determined on annual CAS-4, the duty already paid during said period has to be adjusted. The question of unjust enrichment has no relevance here. There is no refund considered here. The point that the duty paid in excess in certain months has been availed as credit by sister unit hence, cannot be adjusted towards short payment also not tenable. The demand arose based on annual costing. Such cost price in terms of Rule 8 will apply to all clearances made during the relevant year. Admittedly, duty already discharged has to considered for arriving at overall short payment. Selectively applying the said cost price only for months when the clearances were below such cost price is not legally sustainable.
It is found that the Original Authority has not fully examined the issue of time bar raised by the appellant. Intimations of price revision followed by CAS-4 Certificates have been given to the Department. Monthly statutory returns with duty payment details have been filed. The existence of more than one cost certificates during different months in one financial year is apparently in the knowledge of the Department. Hence, the question of time bar requires closer scrutiny. Since we intend to remand the case to the Original Authority on the quantification of duty demand, this aspect also has to considered by the Original Authority for a clear finding. - Appeal partly allowed by way of remand
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2016 (9) TMI 1174
Confiscation of seized SS Ingots - Recovery of Central Excise duty - confirmation of demand was drawn from certain private records recovered from the premises of the appellant unit and various statements given by the Director, Authorized Signatory, Gate Keeper of the appellant unit and other persons like transport drivers etc. - denial of cross examination - violation of principles of natural justice as due opportunity not being extended to the appellants to defend their case
Held that:- as seen from the findings of the Original Authority the charge against the appellants regarding clandestine production and removal are considered to be supported by recovery of parallel set of invoice, private records, confessional statements of transporters, confessional statement of various concerned persons and inquiries conducted at various ends. It is apparent that the statements of various persons have been relied upon to draw the conclusion. In other words, the case is not only based on documents. Necessarily in such situation the appellants should have an opportunity to clarify their side by cross examining the persons who gave statement relied upon. This legal position has been fairly well settled by the Hon’ble Punjab& Haryana High Court in a recent decision in the case of G-Tech Industries vs. UOI [2016 (6) TMI 957 - PUNJAB & HARYANA HIGH COURT].
We consider it proper to remand the matter back to the Original Authority to follow the procedure set out in Section 9d of the Act and also follow guidelines as explained by the Punjab & Haryana High Court (supra). Accordingly, the impugned order is set aside. The matter is remanded back to the original authority for the decisions afresh. Due opportunity shall be given to the appellant to defend their case including personal hearing. - Appeal allowed by way of remand
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2016 (9) TMI 1173
Valuation - includability - freight incurred in transportation of goods manufactured - post clearance from the factory to the place or site of the buyers - Held that:- it is evident that the goods have been delivered to the buyer at the factory gate as is evident from the invoice and the purchase Orders by reading together. In the invoices, the appellants have charged sales tax and have also reflected the freight separately in most of the cases. Further, it is an admitted fact that in most of the cases of clearance, the goods after manufacturing in the plant of the appellant, are subject to pre delivery inspection by the buyer and are ascertained in favour of the particular buyer before the delivery. Accordingly, we hold that the, transfer of ownership takes place at the factory gate when the goods are delivered. Therefore, the ld. Commissioner have erred in holding that the goods manufactured and cleared by the appellant, shall not be valued under Section 4(1)(a) but under Section 4(1)(b). We hold that the valuation shall be done in the appellants case only under Section 4(1)(a), as explained by Hon'ble Supreme Court in the case of C.C.E. Mumbai Vs. Official Liquidator for Brimco Plastic Machinery Pvt. Ltd. [2015 (10) TMI 2281 - SUPREME COURT]. - Decided in favour of appellant with consequential relief
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2016 (9) TMI 1172
Export of goods procured against CT-1 certificate after processing and not in the same condition - entitlement of benefit of Notification No. 42/2001 CE(NT) dated 26.06.2001 - contravention of condition of Notification - Held that:- there is no allegation against the appellant for non filing of undertaking/declaration of the department and the fact of the goods has not been disputed by both the sides. In that circumstances, on the decisions of I.O.C Ltd. Vs. Commissioner of Central Excise, Calcutta-II [2004 (6) TMI 222 - CESTAT, KOLKATA] is applicable to the facts of this case wherein this tribunal observed that the commissioner in his order has also admitted that the documents have been filed and the facts of export have been accepted.
The department's grievance is that the superintendent of Central Excise did not attend the export. It was not required. The appellant was governed by self removal procedure and to such cases Rule 173-0 was applied. It was the appellant's option to export under supervision of either the Excise authorities or the Customs Authorities. The commissioner is competent to relax the procedural provision under Rule 12/13 or the Central Excise rules, 1944. In the instant case, it was incumbent upon the Commissioner to grant relaxation from the procedure from the procedural provisions. This Tribunal has observed that when the show cause notice itself admits that export have been taken place after, there is no procedural irregularities in removal of the goods otherwise the SRN was not cleared, then the refinery operations would have come to stoppage. In this case, it is not disputed the goods procured by the appellant has been exported, therefore, I hold that the appellant has complied with conditions of the said notification and there is no demand of duty is sustainable against the appellant. - Decided in favour of appellant
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2016 (9) TMI 1171
Deemed Manufacture - emergence of clean oil through the processes, such as, Dehydration, Distillation, Clay Polishing and Filtration from waste and used oil - clean oil were packed in bulk packs of drum and sold to industrial customers - application of Chapter note 4 of Chapter 27 of schedule to the Central Excise Tariff Act, 1985 - Held that:- for applying the Chapter note 4 to any goods for examining, whether, manufacture has taken place, it is essential to establish (i) either there is labeling or re-labeling of containers, (ii) there is re-packing from bulk packs to retail packs (iii) such treatments have adopted, so that product is rendered marketable to consumer. From the show cause notice and relied upon documents for issue of show cause notices, we do not find that Revenue could establish that the goods emerged after removal of impurities from waste oil have been marketed to consumer. In fact, there was not a single invoice raised to a consumer, establishing that the goods were marketable to consumer. All the invoices were for bulk packing and sold to industrial customers. Further, there was no evidence of labeling or re-labeling or for re-packing into retail packs. We, therefore, hold that all the show cause notices involved in the four appeals in hand lack, prima facie, evidence for leveling charges leveled and unsustainable. Hence, the two Orders-in-Original impugned in four appeals in hand, are set aside. - Decided in favour of appellant
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2016 (9) TMI 1170
Recovery of Cenvat credit - Reversal of Cenvat credit under Rule 6(3) passed on to the buyers - laminates manufactured by appellant - Department alleged that appellants wrongly paid Central Excise duty and wrongly passed on Cenvat Credit to their buyers - Held that:- if Cenvat Credit was not admissible to them, then the Revenue should have issued show cause notice for reversal of Cenvat Credit availed by them. The show cause notice is issued for recovery of amount under Rule 6(3)(b) ibid, & the amount to be recovered under Rule 6(3)(b) ibid, is possible only when the Cenvat Credit is admissible. We find that contradictory stands were taken in the said show cause notice by the Revenue. Therefore, the show cause notice is not sustainable. - Decided in favour of appellant with consequential relief
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2016 (9) TMI 1133
Modvat credit - necessary entries relating to aluminium shots used in the manufacture of steel were not made in RG-23A Part-I, since at the material time, the appellants were not aware as to whether deemed credit on the said goods were admissible - instead of taking the credit at the time when appellant received the goods, they took the credit at a later period - Held that:- by respectfully following the decision of the Hon’ble High Court of Allahabad in the case of CCE Vs. Ramswarup Electricals Ltd. [2007 (5) TMI 116 - HIGH COURT , ALLAHABAD] which was taken by relying on the decision of Hon'ble Apex Court in the case of Collector Vs. Raghuvar (India) Ltd. [2000 (5) TMI 40 - SUPREME COURT OF INDIA], we hold that the deemed Modvat Credit is admissible. - Decided in favour of appellant
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2016 (9) TMI 1132
Classification - motor vehicle chassis manufactured and cleared in CKD/SKD condition from various divisions of the respondent - whether to be classified under CETH 8708 as per appellant or CETH 8706 as per Revenue - Held that:- a correct classification of appellant's goods for the period 15.09.2005 to 30.11.2005 will be the correct classification for the period prior to 15.09.2005 or after 30.11.2005 so long as there is no change in the relevant CET headings. Before the issue of present show cause notice dt. 01.03.2004 respondent was seeking change in the classification of the impugned goods by writing letters to the department. Once department has chosen to demand duty in show cause notice dt. 01.03.2004, then respondent had every right to contest that differential duty demand as not payable due to incorrect classification even if duty was paid with interest. We do not find anything wrong in OIA dt. 26.09.2007 of the First Appellate Authority to hold the classification of parts cleared by the respondent under CETH 8708 by relying upon the decision of Tribunal in the case of Tata Motors Limited Vs. CCE, Jamshedpur [2007 (8) TMI 209 - CESTAT, KOLKATA] passed by this bench.
It is further observed that ground (iv), taken in the grounds of appeal by the Revenue, is not valid now as order rejecting Revenue s ROM has been finally upheld by Apex Court by dismissing Revenue s appeal. The apprehension of the Revenue in ground (vi) of the grounds of appeal, that change in classification for the earlier period will tantamount to making re-assessment, is not the correct appreciation of law. As per Rule-2(b) of the Central Excise Rules, 2002 assessment includes self-assessment of duty made by the assessee and provisional assessment under Rule-7. At the same time it will also include self-assessment . Assessment or re-assessment is not restricted to only deciding classification of the goods manufactured by an assessee, but will also include deciding the valuation of goods and the rate of duty applicable. It will also include demands/refunds under Section 11A and Section 11B of the Central Excise Act, 1944 arising as a result of scrutiny and finalization of provisional assessments. The issue of deciding the classification of the respondent s products does not mean that all the procedural requirements of assessment/re-assessment/self assessments have been changed. The provisions of Section 11B of the Central Excise Act, 1944 will have to be followed and satisfied if re-assessment has to be completed. - Decided against the Revenue
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2016 (9) TMI 1131
SSI Exemption - Valuation - Notification No. 8/2003-CE dated 1.3.2003 - retail prices charged to customers in the shop - Held that:- appellant pleaded that the department added the value of even non-excisable goods and exempted excisable goods which are to be excluded as per the Notification No. 8/2003-CE. In this regard, we observe that the assessee/appellant is correct that for deciding on the eligibility of exemption Notification No. 8/2003-CE the turnover is to be computed after excluding the value of non excisable and exempted excisable goods. Revenue has to follow this principle that value of non-excisable and non exempted goods are not to be added when the turnover is computed to decide on the entitlement to benefit of Notification No. 8/2003-CE. Assessee has been manufacturing various kind of items and some of these items may not have the facility of abatement under Central Excise law. Assessable value has to be determined by reducing the sale price in such a manner so as to arrive at the price on which the manufacturer would have sold the said goods in wholesale. It is to be noted that value has been defined in Explanation (c) to the Notification No. 8/2003; therefore, total turnover to decide on eligibility is to claim benefit of Notification No. 8/2003 to be computed by totalling the value of specified goods only.
The submission of the assessee for giving them the benefit of abatement is correct; and assessable value of excisable items being manufactured by the assessee/appellant is to be arrived at after giving them the benefit of abatement. The appellants have referred to a copy of Notification No. 14(NT) dated 1.3.2008 claiming the facility of abatement, whereas the goods have been assessed at the retail sale price of subject items. This aspect has not been discussed by the lower authorities, when it is so then the department has to consider/give abatement as admissible for the goods being manufactured by the assessee before arriving at the liability of central excise duty against the assessee. The matter, therefore, deserves to be remanded to the original adjudicating authority for deciding afresh the liability of Central Excise duty of the appellant unit after calculating the correct turnover (i.e. after deducting the value of non-excisable and exempted excisable goods) and further after giving the benefit of abatement as applicable in respect of the items manufactured, which are under abatement facility. Proper opportunity of being heard shall be provided to the appellant as per law.
Invokation of extended period of limitation - assessee has been in correspondence with the department since the year 1998 - numerous letters and correspondence between the assessee and department on the problems faced by them - regular returns with the department on the goods manufactured were filed by the assessee - Held that:- it is established that there has not been any suppression of facts or wilful misstatement on the part of the appellants. Therefore, for the present facts law of Central Excise does not permit the Revenue to invoke extended period of limitation. In other words, Deptt. cannot issue demand for the period beyond one year from the relevant date, which is the date of Show Cause Notice (SCN). Therefore, demand for the period beyond one year is set aside and demand for the period of one year preceding the relevant date which is 29.12.2006, the date of SCN, is sustained.
Imposition of penalty - Held that:- it is clear that the appellant No. 2 Shri Atul Tandon, partner in the appellant No. 1 firm has not knowingly been involved in any manner in contravention of laws of Central Excise with reference to the subject goods making the said goods liable to confiscation under the law of Central Excise. Therefore, the penalty of ₹ 5 lakhs imposed on the appellant No. 2 Shri Atul Tandon, partner of the appellant No. 1 assessee under Rule 26 of Central Excise Rules, 2002 is hereby set aside. - Appeal disposed of
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2016 (9) TMI 1130
Classification - Milk Shake Mixes - whether they are to be classified under Chapter Heading 1901.90 90 of Central Excise Tariff as per Revenue or under 0404 as claimed by the assessee - Held that:- by considering the CESTAT's decision in the case of Amrit Foods Vs. CCE, Meerut-I [2006 (3) TMI 523 - CESTAT, NEW DELHI] endorsed by Hon ble Apex Court in the case of CCE, Vs. Amrit Food [2015 (9) TMI 1269 - SUPREME COURT], we hold that the Milk Shake Mixes are rightly classifiable under Chapter Heading 0404 only.
Classification - flavoured syrups/fruit syrups/Squashes - whether they are to be classified under Chapter Heading 21069040/2169050 as per Revenue or under Chapter 20 of Central Excise Tariff as per assessee - Held that:- it is found that the appellant has not given complete ingredients of the subject items; they have only conveyed that products have got more than 25% fruit contents. The Explanatory Notes to HSN for Chapter Heading 2009 inter alia mention that wherever greater quantity of water has been added, the resultant diluted product may have the character of the beverages of Heading 22.02, but the classification under Chapter 22.02 has not been argued by any side in the present proceedings i.e. either by the Revenue or by the assessee/appellant. The Revenue specifically pleads for classification under Chapter Heading 21069040 and 21069050.
Consequently, from the records available and the submissions given by both sides, when no other alternative classification like Heading 22.02 etc. has been cited by either the appellant or the Revenue, and after considering the description given for the Chapter 2106 of Central Excise Tariff as well as the Explanatory Notes to HSN for Chapter 2106 mentioned above, we are of a considered view that the subject items are to be classified under Chapter Headings. 21069040/2106905.
Notification No. 3/2005-CE dated 24.2.2005 - benefit of exemption - eligibility - chocolate syrup, Butter Scotch, Blue curacao, Grenadine, Mint, Orange, Triple Seed, Caramel, Natural Caramel, Vanila, Lime - goods sold without brand name of assessee - Held that:- the appellant claims that goods were unbranded whereas the Revenue says that there was no sufficient evidence produced by the appellant to prove that the goods were unbranded. We remand the case back to the original adjudicating authority for decision afresh on this issue within three months of receipt of this order, where the appellants would be given opportunity of hearing and production of evidence, if any, in respect of branding or unbranding of the goods.
Notification No. 3/2005-CE dated 24.2.2005 - benefit of exemption - eligibility - Mixed Seasoning Chinese Flavour - Held that:- the appellant contended that both the conditions of Notification No. 3/2005 that goods be in other than unit container and be not bearing the brand name, have been fulfilled. There is clear finding that goods are in unit container. The appellants say that the goods were in unit container up to 28.2.2005. Further from the facts on record for the period after 29.2.2005 it is not proved that the goods were not bearing the brand name. It means that the assessee/appellants in any case are not entitled to the benefit of the Notification No. 3/2005 for these goods up to 28.2.2005. Therefore, the demand of duty of Central Excise on all these goods for the period up to 28.2.2005 is hereby confirmed. However, for the period after 28.2.2005, the matter is remanded back to the original adjudicating authority to decide afresh within three months of receipt of this order.
Invokation of extended period of limitation - demand and imposition of penalty - wilful suppression or mis-statement of facts - intention to evade payment of duty - Held that:- there is no material on record to prove wilful suppression or any mis-statement of facts with intention to evade payment of duty of Central Excise on the part of the appellants. Therefore, it is held that liability of duty of Central Excise can be fixed only for the period of one year from the relevant date. Consequently, demand beyond the period of one year from the relevant date is time barred as per the provisions of law of Central Excise. As there is no wilful suppression or mis-statement with intention to evade payment of duty of excise by the appellants, the penalties imposed of ₹ 71,83,194/- on the appellant No. 1 under Section 11AC of Central Excise Act, 1944 and of ₹ 2,00,000/- on appellant No. 2, Shri Rajiv Behl, Director under Rule 26 of Central Excise Rules, 2002 are hereby dropped.
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2016 (9) TMI 1129
Cenvat credit - eligibility - inputs and capital goods i.e. steel, copper items used in fabricating support structures which is not included in the registered premises - structures emerging are not capital goods and or immovable civil constructions - Held that:- we have carefully considered the nature of impugned items and their usage as elaborated in the chart submitted by the Chartered Engineer. It has been categorically submitted that the steel items have not been used for making support or civil structure or for making foundation. The copper tube, rod were used for making bus duct/bar of channels, copper earthing and for instrumental in the captive power plant. A perusal of the chart submitted by the respondent indicates that the findings in the impugned order is being challenged by the Revenue mainly on general assertions and case laws. As noted, there has been no attempt to independently verify the nature of various items and their ultimate usage in order ascertain the respondent’s eligibility of credit on such items. The appeal is mainly on general principles and case laws without any specific material evidence to controvert the findings by the lower Authority. Taking into consideration the analysis made by the First Appellate Authority and the detailed chart submitted by the respondent regarding usage of impugned items, we find no merit in the present appeal by the Revenue. - Decided against the Revenue
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2016 (9) TMI 1128
Refund claim - period from July, 2001 to March, 2002 - Special Excise Duty & Educational Cess paid by them from 1st March, 2005 to 6th April, 2005 on the goods manufactured by them - unjust enrichment - appellant passed on various discounts to the buyers during the said period by issuing credit notes - appellant pleaded that at the time of removal of the goods, it was not possible to know the quantum of discount that was to be deducted from the transaction value - Held that:- the Hon’ble High Court of Punjab & Haryana held that both the appellate authorities below have recorded a concurrent finding of fact that no incidence of duty, in respect thereof the claim had been preferred by the assessee, had been passed on to the customers. We find that the ruling of Hon’ble High Court is squarely applicable in the present case. Therefore, we allow the appeal filed by M/s Varun Beverages Ltd. We further do not find the ground raised by Revenue, to be tenable in law. - Decided in favour of appellant
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2016 (9) TMI 1127
Cenvat credit - dumpers and parts thereof - dumpers used for carrying raw materials like limestone etc. from the mining area to the site of the crusher - Held that:- dumpers are material handling equipments used for transportation of limestone from mining area to the crusher which is further used for the manufacture of cement; therefore, the dumpers are to be treated as used in or in relation to the manufacture of final products and thus, qualifies as an “input”. Therefore, in view of the various decisions of higher judicial fora and the case laws , the subject goods -dumpers and parts thereof are held to be entitled to cenvat credit. - Decided in favour of appellant with consequential relief
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2016 (9) TMI 1126
Exemption Notification No. 6/2006 dated 01.03.2006 read with Notification No. 21/2002-Cus. dated 01.03.2002 - availment of benefit - supply of electric wires and cables under international competitive bidding to various thermal power plants without payment of duty - exemption denied on the ground that classification against Sl. No. 400 in Notification No. 21/2002-Cus. is indicated as 9801 whereas the wires and cables manufactured and cleared by the appellants are classifiable under CETH 8544.
Held that:- in view of the various decisions of Tribunal in the case of Sarita Steels and Industries Ltd. vs. CCE [2010 (7) TMI 568 - CESTAT, BANGALORE], in the case of Om Metals SPML JV Unit 2 vs. CCE &ST, Jaipur [2013 (11) TMI 1361 - CESTAT NEW DELHI] and in the case of Paramount Communications Limited [2016 (7) TMI 863 - CESTAT NEW DELHI] wherein it was held that the denial of exemption on the ground of classification shown under Customs Notification is 9801 is not sustainable, it is clear that the denial of the exemption to the appellant is not legally sustainable. Admittedly, the condition stipulated for exemption under Notification No. 6/2006-CE has been fulfilled by the appellant except for the classification in column-2 of Entry No. 400 in Customs Notification No. 21/2002-Cus. As clearly noted, the classification 9801 is not available in Central Excise Tariff and the same relates to project import, as such the denial of exemption on this grounds is legally not sustainable. - Decided in favour of appellant
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2016 (9) TMI 1125
SSI Exemption - Period of limitation - Refund claim - duty paid at the full rate by availing Cenvat Credit during financial years 1989-90 to 1993-94 as the SSI certificate was rejected - subsequently the SSI certificate was granted w.e.f 12.05.1989 as per the directions of the Hon'ble High Court of Madhya Pradesh at Jabalpur - Held that:- the original authority has rejected the refund claim taking the view that the claim has been filed beyond the period of one year and hence time barred under Section 11-B of the Central Excise Act. He has considered that the duty paid by the assessee cannot be considered as paid under protest. He has further held that the claim is liable to be rejected on the ground of unjust enrichment as the assessee has failed to produce the copies of the contracts entered into with the customers from which it could have been established. We find that the first appellate authority in the impugned order has considered all these submissions and given a detailed finding on all the points. Therefore, we are in complete agreement with the view taken by the first appellate authority and find no reason to take a different view. Accordingly, the impugned order is upheld. - Decided against the Revenue
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