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Central Excise - Case Laws
Showing 41 to 60 of 378 Records
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2017 (10) TMI 1301 - CESTAT NEW DELHI
Clandestine manufacture and removal - non-receipt of goods by the ultimate buyers - Held that: - The present appellant is one of the parties, whose case was also investigated by the Department on the basis of seizure of the diary of Shri Kilash Agarwal - for attaining the finality of the case, this matter should also be remanded to the original authority for a decision in line with the order of the Tribunal dated 09.03.2017 - appeal allowed by way of remand.
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2017 (10) TMI 1300 - MADRAS HIGH COURT
Maintainability of petition - alternative remedy of appeal - Section 129 A(1) of the Customs Act - time limitation - Held that: - Considering the fact that the petitioner is a Government of India Corporation, and also due to the fact that the second respondent has been declared as insolvent, this Court deems it appropriate that it can exercise discretion in the case and grant time within which the petitioner can file an appeal before the CESTAT - while declining to entertain the writ petition, liberty is granted to the petitioner to file an appeal before the CESTAT - petition disposed off.
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2017 (10) TMI 1298 - CESTAT CHANDIGARH
Valuation - inclusion of chassis in the goods cleared by SML - Rule 10A of the Central Excise valuation Rules - Held that: - the identical issue came up before this Tribunal in the case of Audi Automobiles V. CCE [2009 (5) TMI 426 - CESTAT, NEW DELHI] wherein it has been held that the assessee is liable to pay duty in terms of Rule 10A of the Rules i.e. on the value at which the principal manufacturer cleared the goods on payment of duty, therefore, the differential duty is confirmed along with interest.
Extended period of limitation - Held that: - in the case of Audi Automobiles itself, this Tribunal observed that the appellant cannot be accused of my suppression documents - extended period of limitation - penalties not imposable.
Demand of duty within the period of limitation is confirmed along with interest - appeal allowed in part.
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2017 (10) TMI 1297 - CESTAT MUMBAI
Refund claim - perusal of relevant documents - Held that: - although the appellant relied on certificate of Chartered Accountant, that is not conclusive evidence - learned authority shall call for the basic documents to ascertain whether there arises refund if any of the appellant to refund - appeal is remanded to learned adjudicating authority.
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2017 (10) TMI 1296 - CESTAT AHMEDABAD
Remission of duty - CENVAT credit - whether the Appellant is required to reverse the credit availed on inputs used in the production on the semi-finished goods which were destroyed in fire?
Held that: - the remission from duty as prescribed under Rule 21 of CER, 2002 is applicable to finished goods and not to semi-finished goods - Besides, the incident of fire took place in the month of August, 2007, hence, it is covered by the decision of of Hon'ble Gujarat High Court in the case of C.C.E. & Cus , Ahmedabad II vs. Intas Pharmaceutcals Limited. [2013 (4) TMI 532 - GUJARAT HIGH COURT], where it was held that for input credited earlier, there is no scope of reversal of the credit if the finished product becomes unfit for human consumption unless any condition has been imposed for remission of duty in terms of Rule 21 of the Central Excise Rules, 2002 making it clear that the credit already taken is to be reversed.
Appeal allowed - decided in favor of appellant.
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2017 (10) TMI 1295 - GUJARAT HIGH COURT
Vires of section 4A of the Central Excise Act, 1944 - According to the petitioner, the said provision is beyond the legislative competence of Union Legislature - charging excise duty under section 4A of the Act on the trade discount provided by the petitioners in the shape of free medicines on bulk purchases - levy of duty on the free samples provided to the doctors - related party transaction.
Validity of section 4A of the Act - Held that: - The concept of not levying duty on taxes is retained also under section 4A where the Central Government while providing amount of abatement in such retail sale price would take into account the amount of duty of excise, sales tax and other taxes if any payable on such goods. It is true that retail sale price of the MRP would take into account certain post sale costs which may not be borne or payable by the seller and would also include the profit of the successive dealers. However, the abatement that the Government may allow in the retail sale price would also be expected to take into account such factors in addition to the duties of excise, sales tax and other taxes which may be payable. Though no specific formula is provided for providing such abatement and it may be that in a given case the abatement that the Government may permit under the notification may not entirely neutralize of such costs, the question is would that by itself render the provision unconstitutional?
The concept, that the duty of excise is to be charged on manufacturing costs and manufacturing profits is all too well settled and recognized. However, its application to every case may have a different element. In case of Cibatul Limited. P.O. Atul (supra) the Division Bench of this Court considered the constitutionality of an amendment in section 4 of the Act through which the Parliament introduced the concept of a related person for charging of duty of excise. In case the seller and buyer were found to be related persons, as per the definition contained therein, the excise duty would be charged not on the price which the manufacturer charges his buyer but on the price which the buyer would charge from his ultimate customers - The Court referred to large number of judgements of Supreme Court to observe that the duty of excise, within the meaning of Entry 84 in the Union list, is a tax on manufacture or production. It must be linked with the manufacture or production of excisable article. It can be levied on the assessable value of excisable goods which consists of the manufacturing costs and manufacturing profits and which cannot be loaded with post-manufacturing costs and post manufacturing profits such as those which arise out of subsequent sales. On such basis, the Court declared that the relevant amendment in section 4 of the Act is ultra vires the Parliament's legislative competence.
Duty on free samples provided to the doctors - Held that: - Under sub-section (1) of section 4A itself, the Central Government can notify goods in relation to which, under the provisions of the Standards of Weights and Measures Act or the rules made there under, it is necessary to declare on package, the retail sale price of such goods. The free samples provided to the doctors on the contrary contain necessary declaration required under the law that the samples are free of charge and are not for sale in the market. The very first requirement of sub-section (1) of section 4A of the Act in such a case fails. For such reasons duty of excise cannot be levied on such free samples in terms of section 4A of the Act - it is absolutely clear that the Valuation Rules of 2000 would apply in a case where the duty of excise is levied under section 4 of the Act. The respondents cannot seek to levy duty under section 4A but apply the method of computation of the value of the goods which is devised for the purpose of section 4 of the Act. Clarificatory instructions dated 25.04.2005 do not lay down correct position in law.
The petitioner's challenge to the vires of section 4A of the Act fails - the excise duty on the doctors' free samples can be levied only under section 4 of the Act and not under section 4A.
Petition disposed off.
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2017 (10) TMI 1283 - CESTAT, DELHI
Liability of Central Excise Duty - processing of iron ore whether amounts to manufacture or not? - Held that: - There is no special process facility with the appellant. Improvement in the content of “Fe” due to the processes undertaken by the appellant by itself will not make the resultant product as iron ore concentrate - process undertaken by the appellant do not amount to manufacture of new product as understood in the industry - liability of duty do not arise - appeal allowed - decided in favor of appellant.
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2017 (10) TMI 1226 - CESTAT NEW DELHI
Clandestine removal - clearance of processed MMF under the cover of 139 challans - Held that: - In view of the fact that the Director has not specifically admitted that the goods were removed clandestinely from the factory and in view of the fact that the challans contained the name of the consignee as ‘self’, it can be concluded that the charges of clandestine removal cannot be levelled against the appellant with regard to the goods covered under 139 challans - demand set aside.
Removal of the goods under the cover of 22 challans - Held that: - In view of the fact that the Director of the Company has admitted that the goods were removed without payment of Central Excise duty, the Central Excise duty demand confirmed in respect of clearance of disputed goods in respect of 22 challans is proper and justified and the impugned order cannot be interfered with at this juncture.
Penalty - Held that: - Since the adjudicating authority has not given the option to the appellant to deposit the reduced amount of penalty of 25%, such option should be available to the appellant. Accordingly, the adjudicating authority is directed to quantify the amount of reduced penalty, which is required to be paid by the appellant.
Personal penalty on the Director of the appellant company - Held that: - the department has not specifically brought on any evidence, showing his involvement in clandestine removal of goods - provisions of Rule 26 of Central Excise Rules, 2002 cannot be invoked for imposition of personal penalty - penalty set aside.
Appeal allowed in part and part matter on remand.
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2017 (10) TMI 1225 - CESTAT NEW DELHI
CENVAT credit - credit taken was disputed by the Department on the ground that the inputs used in the trial production were converted into waste and scrap; and that since the goods were not used for manufacture of finished goods - Held that: - As per the statutory provisions, taking of Cenvat Credit is subject to the condition that the inputs and capital goods are received in the factory of manufacture of final product. In this case, the fact is not under dispute that the disputed goods were received in the factory and intended for use in the manufacture of excisable final product.
Since the appellant commenced its manufacturing activities on trial basis and commissioning of its plant facilities, those goods were used in such trial run. Accordingly, after use in the manufacturing processes, the inputs became waste. Since, the goods have been put to use for the intended purpose and admittedly received in the factory of manufacture, the requirement of Rule 3 ibid has been duly complied with for the purpose of availment of Cenvat credit.
Appeal allowed - decided in favor of appellant.
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2017 (10) TMI 1224 - CESTAT NEW DELHI
CENVAT credit - time limitation - maalfide intent - Held that: - the Department took more than 3 and half years for issuing the show cause notice from the date of reply to the spot Memo - no iota of evidence was brought on record to show that the appellant had indulged into malpractices or had fraudulent motive in availment of Cenvat Credit in respect of non-availability of subject goods in the factory - Appeal allowed - decided in favor of appellant.
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2017 (10) TMI 1223 - CESTAT CHANDIGARH
Rectification of mistake - application for change in the cause title of the appeal - Held that: - application for change in the cause title of the appeal inasmuch as the appellant, who was earlier known as M/s Met Trade India ltd., is now, Metenere Ltd., w.e.f. 21.11.2013 - In view of the fact of change in the company's name, we allow the miscellaneous applications and replace the old name of the appellant with the new name.
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2017 (10) TMI 1222 - CESTAT NEW DELHI
Penalty - Duty paid under protest before issaunce of SCN - NCCD - EC - SHEC - whether the penalty is imposable upon the assessee u/r 25 of the CER, 2002, read with section 11AC of the CeEA, 1944 for violation of provisions of Rule 4 and 8 of CER, 2002 and the provision of N/N. 50/2003, with intent to payment of duty - Held that: - Hon’ble Bombay High Court in the case of CCE Mumbai Vs. Hindustan Petroleum Corporation Ltd. [2016 (12) TMI 1269 - BOMBAY HIGH COURT] observed that ‘in case of non-payment or short-payment of duty, penalty gets automatically attracted and authority had no discretion - the issue is relating to National Calamity Contingent Duty (NCCD); Education Cess, and Secondary and Higher Education Cess which was neither created by the Central Excise Act, 1944, nor a subject matter of Ministry of Finance - penalty sustained - appeal dismissed - decided against appellant.
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2017 (10) TMI 1221 - CESTAT NEW DELHI
Valuation - includibility - the cash discounts on the goods sold to the dealer from depot/branches directly from factory at the time of clearance of the said goods - Held that: - an identical issue has come up before this Tribunal in the assessee-Appellants’ own case M/s Kisan Irrigation Ltd. Vs CCE, Indore [2016 (1) TMI 696 – CESTAT, New Delhi], where it was held that As relying on Purolator India case [2015 (8) TMI 1014 - SUPREME COURT ] it is held that the appellants are entitled for claiming deduction of cash discount from the transaction value on the clearances made from the factory to all the customers - appeal allowed - decided in favor of appellant.
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2017 (10) TMI 1220 - CESTAT ALLAHABAD
Clandestine removal - DMO - Whether duty have been rightly demanded on the 71 drums of DMO lying in the factory premises on the date of inspection/panchnama dated 27/07/2006?
Held that: - there is lack of sufficient material on record to support the contention of the Revenue that the DMO so found and seized was in marketable stage - Revenue have failed to investigate further on the assertions and explanations given by the appellant that the DMO was not marketable but requires further stages of processing to make it marketable and also insisted on test report, which was not done and as such, there is lack of material to support the allegations in the show cause notice - ALSO, DMO was found inside the factory premises and there was no action and/or attempt on the part of the appellant to remove the same clandestinely.
Demand set aside - appeal allowed - decided in favor of appellant.
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2017 (10) TMI 1185 - CESTAT MUMBAI
Single registration for two factories - Chapter 2 of CBEC's Supplementary instructions - Held that: - As per the fact of the present case both the units are separated by a public road and process is same being, goods of both the units are used in each other, raw material in both the units are common, there is a common labour work force, common administration/work management, common sales tax registration, common Income Tax assessment and common balance sheet etc. As per the para 2.2 of Chapter 2 it is not necessary that all the factors should be fulfilled. On the reading of the same, I am of the view that even if one of the factor is fulfilled, the common registration can be issued.
The appellant have fulfilled not only one but most of the factors provided in para 2.2 of Chapter 2, therefore they have made out a fit case for grant of single registration in respect of two units.
Appeal allowed - decided in favor of appellant.
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2017 (10) TMI 1184 - CESTAT MUMBAI
Refund of unutilized CENVAT credit - part refund denied on the ground that the fabric on which deemed credit availed by the appellant has not undergone the process of manufacturing in terms of Section 2(f) of CEA, 1944 - Held that: - the appellant have carried out the process of cutting, folding, packing etc. for the purpose of export of such goods on job work basis on behalf of principal M/s S.V. Business Pvt. Ltd. Therefore the process carried out by the appellant is only remaining part of the overall manufacturing process, partly carried by their principal and partly by them. Therefore the refund under Rule 5 cannot be denied on the ground that process alone of the appellant is not amount to manufacture.
Even if input is not used directly by the manufacturer of final product declared in the notification but are contained in the said final product deemed credit of input is admissible. Therefore the input which was used by the principal for manufacture of processed fabrics, the appellant is entitled for the deemed credit, it is also admitted fact that the final goods was cleared for export by the appellant.
Refund allowed - appeal allowed - decided in favor of appellant.
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2017 (10) TMI 1183 - CESTAT MUMBAI
Manufacture - the appellant had imported various parts of motor vehicle. The said parts were subjected to process of packing repacking in unit container, labelling/ relabeling and affixing the brand name along with MRP on the product before clearing to their dealers/ customers - case of the department is that the said activity carried out by appellant is covered under third schedule to Central Excise Act and also amounts to manufacture in terms of Section 2(f)(iii) of the Central Excise Act 1944 with effect from 01.03.2003 - classification of goods.
Held that: - the goods repacked and sold as spare parts is not classifiable under 8708 but it is correctly classified under respective chapter heading as held by the adjudicating authority. - in respect of goods specified in third schedule activity such as packing or repacking of such goods in a unit container or labelling or re-labelling of containers including the declaration or alteration of retail sale price on it or adoption of any other treatment on the goods to render the product marketable to the consumer amounts to manufacture. In the facts of the present case, the goods as discussed above are falling under various chapter heading as proposed in the show-cause notice are covered under third schedule and the activity which is undisputedly carried out by the appellants are packing in unit container, labelling with declaration of the MRP on the unit container are clearly covered under Section 2(f)(iii) therefore amounting to manufacture. In this undisputed fact the appellant was liable to pay excise duty on the basis of MRP based valuation under Section 4A after deduction of abatement as provided under notification issued thereunder - the activity being one of manufacturing, clearance of the goods was liable to payment of duty.
Extended period of limitation - Held that: - though the transfer of spare parts to the spare part division on payment of duty may be known to the department from the records, but the activity of packing, repacking, declaration of MRP thereon was not known to the department which alone is the basis for making the product excisable. Therefore the activity of manufacture was not disclosed to the department by the appellant - extended period rightly invoked.
As regards the issue of confiscation of the goods, it is found that the confiscation was made in respect of the goods which had already been cleared and the same was not available. No seizure of such goods were made. Therefore, confiscation of the goods which were not available is not legal and correct - confiscation and redemption fine set aside.
Appeal allowed in part.
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2017 (10) TMI 1182 - CESTAT MUMBAI
Benefit of N/N. 3/2006-CE dated 01.03.2006 - whether the goods manufactured and cleared by the appellant namely "Cheeselings" and "Musst Bites" edible preparations are eligible for exemption N/N. 3/2006-CE dated 01.03.2006 as "Namkeen" under entry sr. no. 29? - Held that: - the products in question are "Cheeselings" and "Musst Bites". Though these products are not fried items but sold as Namkeen. There is no definition of Namkeen. Therefore, it cannot be concluded on the basis that whether the goods is a fried one or otherwise. In such case, the principle of common parlance has to be applied. From the package of the goods, it is clear that on both products, the word "Namkeen" is clearly declared. Therefore, the product in the common parlance is bought and sold as "Namkeen" only.
The product "Cheeselings" and "Musst Bites" are covered under Sr. No. 29 of the exemption N/N. 3/2006-C.E dated 01.03.2006 - the exemption is eligible to the appellant's product.
Appeal allowed - decided in favor of appellant.
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2017 (10) TMI 1181 - CESTAT CHANDIGARH
Area based exemption - Backward area - N/N. 56/2002-CE dated 14.11.2002 - Revenue is of the view that the appellant is not entitled for the benefit of notification, on the grounds that the process of making refined lead ingots and lead alloys, does not amount to manufacture - denial of CENVAT credit - whether the activity undertaken by M/s. GM amounts to manufacture and M/s. GMI is not liable to pay duty?
Held that: - expression manufacture under Section 2(f) was initially not correctly interpreted as per CBEC letter F.No. 4/3/2006 dated 16.06.2006 wherein it has been clarified that a number of departmental and private publications of Central Excise Act, 1944, published from time to time after 1986, contain(ed) an extra word andat the end of Section 2(f)(i) and before Section 2(f) (ii). The Section 2(f) reads as - manufacture includes any process, Incidental or ancillary to the completion of a manufactured product, which means that if the goods have been manufactured and any activity is done thereon for completion of the activity for further use, it shall amount to manufacture - A similar issue has been examined by this Tribunal in the Jindal Stainless Steelway Limited [2014 (9) TMI 658 - CESTAT MUMBAI] wherein the appellant was engaged in cutting and slitting of coils. In addition to that they have carried out the slitting into desirable width as per the customersrequirement, larger weight coils are cut into smaller weight as per the customers requirement, that the coils are coated and layered with plastic for improving drawability besides applying inter-leaving paper for protection of material so as to be fit for end use application. The said activity was examined by this Tribunal, as defined under Section 2(f) wherein the process incidental or ancillary, was held to amounts to manufacture.
Admittedly, in this case, M/s. GM is engaged in the activity of removing impurities from unrefined lead ingots for making lead alloy and thereafter alloy ingots. The refined lead has been recognised in Chapter 78 of Central Excise Tariff Act, 1985 - it is clear that refined lead means the metal weight at least 99.9% of lead and with some other antimony, as prescribed in the Chapter heading note. Therefore, to classify under Chapter 78, first it should be refined to the extent of 99.9% of lead. The Chapter 78 of CETA, itself recognise a separate new product of 99.9% of refined lead.
Whether there is a violation of Article 14 of the Constitution of India, or not? - Held that: - M/s. GM is located in the State of Jammu & Kashmir and working under Notification No. 56/2002-CE dated 14.11.2002 wherein the duty paid through PLA is entitled as credit to M/s. GM and to denial of credit to M/s. GM has resulted in discrimination when compared to other manufacturers of the same goods by same process. Moreover, in their own unit, located in Gandhidham (Gujarat) the benefit is extended. In the light of the above observation, we hold that there should be uniformity in the stand taken by the Revenue and there should be no discrimination in the case in hand and the other cases. In view of the fact that the Revenue itself has admitted that activity undertaken by the appellant amounts to manufacture, therefore, we hold that activity undertaken by M/s. GM cannot be discriminated.
Whether the appellant has been treated as manufacturer or not, in terms of exemption notification under Customs N/N. 96/2009-Cus - Held that: - there is a process of manufacture when making refined lead from unrefined lead even as per the Customs authorities, read with the Import Export Policy, the FTP requires to bring into existence a new product having a distinct name, character and use, basis which the advance licences were granted to M/s. GM. Therefore, it is clear that even from this evidence, the process of making the refined lead and lead alloy ingots amounts to manufacture. Therefore, we hold that the process undertaken by M/s. GM amounts to manufacture in terms of exemption notification under Customs Notification No. 96/2009-Cus.
Whether the ld. Adjudicating Authority is right to drop the demand on account of Cenvat credit utilised for payment of duty or not? - Held that: - a similar issue came up before the Hon'ble High Court of Bombay in the case of Ajinkya Enterprises [2012 (7) TMI 141 - BOMBAY HIGH COURT] wherein the Hon'ble High Court has held that in case of activity does not amount to manufacture, the payment of duty shall amount of reversal of Cenvat credit. Therefore, the ld. Commissioner has rightly allowed the claim of Cenvat credit to M/s. GM. Accordingly, the appeal filed by the Revenue is dismissed.
Whether M/s. GMI is entitled for the benefit of exemption Notification No. 214/86-CE or not? - Held that: - in terms of Notification No. 214/86, the principal manufacturer has to file an undertaking before the jurisdictional Central Excise authority of job works that the principal manufacturer shall pay the duty on the manufactured goods. Admittedly, the said undertaking has been filed by M/s. GM before the authorities below. In that circumstance, there is no fault of the appellant and the benefit of Notification No. 214/86 cannot be denied.
Appeal dismissed - decided against Revenue.
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2017 (10) TMI 1180 - CESTAT AHMEDABAD
CENVAT credit - returned/rejected finished goods - Rule 16(1) of Central Excise Rules, 2002 - Held that: - the relevant documents/invoices for the relevant period were seized by the authorities and there is no evidence that it were returned to the Appellant. Thus, it is clear that these documents are still with the Department. In these circumstances and in the interest of justice, the matters are remanded to the ld. Commissioner (Appeals), to decide the said issue of eligibility of credit of ₹ 26,08,48/- availed on returned/rejected goods afresh - appeal allowed by way of remand.
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