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2018 (7) TMI 994 - AT - Central ExciseExcisability - SSI Exemption - Appellants, engaged in the business of running Hotels throughout the country, also operate a small bakery within the premises of the Hotel at Bangalore wherein Pastries, Cakes, Biscuits, Cookies, Chocolates and Confectionary are made for consumption in the Hotel and also for sale from the sales counter of the pastry shop, located in the Hotel premises itself - whether the Bakery items manufactured and sold by the appellants are excisable? - whether the value of exempted goods can be taken into account for the purposes of arriving at the exemption claimed vide N/N. 8/2003-CE? - Extended period of Limitation. Held that:- It appears that the appellants are attempting to create a confusion between ‘nil’ rate of duty and excisability of goods. There is no ambiguity in the wordings of the Notification - the department is in its right to demand duty on these items. Method to arrive at the value of clearances in the previous year in terms of Notification No.8/2003 (as amended) - Held that:- The appellants contentions are misplaced. It appears that the appellants are attempting to create a confusion between ‘nil’ rate of duty and excisability of goods. There is no ambiguity in the wordings of the Notification - The department was correct in calculating the eligibility limit. Extended period of limitation - Held that:- It is a fact that the appellants have not obtained registration and have not paid the tax during relevant time. However, in the absence of a positive act of suppression of fact, collusion with intent to evade duty, we find that extended period cannot be invoked - The department was aware of the budgetary changes from time to time and there was nothing to stop them from visiting the appellants in even time and demand duty. The fact that all the Five Star Hotels make and sell such bakery items is invariably known / acknowledged and is not certainly a fact which could have been unearthed only after investigation or audit. - extended period cannot be invoked - the demand is liable to be restricted to one year i.e., 2005-06 - penalty u/s 11AC also set aside. The original authority is directed to quantify the duty for normal period i.e., 23.3.2006 to 22.3.2007 and to appropriate the same towards the duty already paid and to refund the balance amount - appeal allowed by way of remand.
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