TMI Blog2012 (12) TMI 348X X X X Extracts X X X X X X X X Extracts X X X X ..... e 4A would not have been applicable if each individual piece was individually packed for retail sale and two or more of such individually pieces were further packaged in bigger boxes, which were also intended for retail sale – in favor of assessee In respect of the clearances to Spare Parts Division of Automobile manufacturers – Held that:- Provisions of Rule 4A would be applicable and the duty would be liable to be paid on the assessable value determined on the basis of MRP declared under the Provisions of Section 4A and in respect of these clearances, the dispute is only on the point as to whether in respect of such clearances of Spare Parts Division of Automobile manufacturers, the duty has been paid on the value determined under Section 4A - Appellant directed to make pre-deposit - E/1960-1961/2011 - 677-678/2012-EX(BR)(PB) - Dated:- 20-4-2012 - Ms. Archana Wadhwa, Shri Rakesh Kumar, JJ. REPRESENTED BY : S/Shri V. Lakshmikumaran a/b Amit Jain, Advocate, for the Appellant. Shri B.K Singh, JCDR, for the Respondent. [Order]. The facts leading to these appeals and stay application are, in brief, as under :- 1.1 Sterling Tools Limited, Faridabad (hereina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom 1-6-2006 to 31-12-2008 and 1-1-2009 to 31-10-2010 respectively and also for imposition of penalty under Section 11AC on the appellant company and partly under Rule 26 of Central Excise Rules, 2002 on Sh. Atul Agrawal, were issued. 1.4 Both the show cause notices were adjudicated by the Commissioner vide order in original Nos. 02-03/DM/Adjn/2011-12 dated 4-5-2011 by which - (a) duty demands as made in the show cause notices, totaling Rs. 14,80,01,338/- confirmed against the Appellant company under proviso to Section 11A(1) of Central Excise Act, 1944 alongwith Interest on duty under section 11AB ibid; (b) Penalty of equal amount i.e. Rs. 14,80,01,338/- was imposed on the Appellant company under section 11AC; and (c) Penalty of Rs. 2 crores, was imposed on Sh. Atul Agrawal under Rule 26 of the Central Excise Rules, 2002. 1.5 Against the above order of the Commissioner, these appeals along with stay applications have been filed. 2. Heard both the sides in respect of stay applications. 3. Shri V. Lakshmikumaran, Advocate assisted by Shri Amit Jain, Advocate, ld. Counsels for the Appellant while not disputing that the goods, in question, are meant solely or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Auto International Ltd. v. C.C.E. - 2003 (152) E.L.T. 3 (S.C.) has held that nuts and bolts and screws, which are suitable for use solely or primarily with the motor vehicles of Heading No. 87.01 to 87 would be classifiable as motor vehicle parts under Heading No. 87.08 and not under Heading No. 73.18, that this judgment relied upon by the department does not help the department s case in any manner, as the dispute in the present case is as to whether in terms of the provisions of SWM Rules, there is requirement to affix the MRP on the packages in which the goods were sold to the wholesale dealers, that even the quantification of duty is not correct as the same is not on the basis of actual MRP, that the appellant have a strong prima facie case and hence, the requirement of pre-deposit of duty demand, interest and penalty may be waived for hearing of the appeals and recovery may be stayed till the disposal of the appeals. 4. Shri B.K. Singh, ld. Joint CDR opposed the say application by reiterating the findings of the Commissioner in the impugned order and emphasized that - (a) the goods, in question, are not general purposes nut and bolts but are parts of automobiles which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions of SWM Rules or of the Rules made thereunder or any other law for the time being in force. 6. The provisions applicable to packages intended for retail sale are contained in Chapter 2 of the SWM Rules and according to Rule 2A the provisions of this Chapter do not apply to packaged commodity meant for industrial consumers or institutional consumers as defined in the explanation to this Rule. The automobile manufacturers purchasing the fasteners from the Appellant for the use in the manufacture of automobile are covered by the definition of industrial consumers and hence, in respect of the fasteners cleared to automobile manufacturer for use in the manufacture of automobile, there is no requirement under the law for declaration MRP on their packages and in respect of such clearances, the duty would be payable on the transaction value determined under Section 4. In fact there is no dispute in respect of the clearances to automobile manufacturer for their use in the manufacture of automobiles. 7. The second category of clearances are to Spare Parts Division of Automobile Manufacturers. The fasteners cleared to Spare Parts Division of Automobile Manufacturers are in boxe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers, the provisions of Rule 17 read with Rule 2(j) of the SWM Rules apply. However, we find that while the period of demand is from 1-6-2006 to 31-10-2010, Rule 17 and Rule 2(j) of SWM Rules were deleted w.e.f. 31-1-2007 by GSR 425(E), dated 17-6-2006. Therefore, for the period w.e.f. 31-1-2007, the Commissioner s findings that the goods sold to the dealers being multi-piece packages, there were requirement to affix MRP on the packages, would not be correct. Even for the period prior to 31-1-2007 when Rule 17 read with Rule 2(j) of the SWM Rules were there, the goods being cleared do not appear to be covered by the definition of multi-piece packages , as it is not the department s case that each piece was individually packed in retail sale while in terms of the Rule 2(j) of the SWM Rules, during the period prior to 31-3-2007 multi piece package means a package, containing two or more individually packaged or labelled pieces of the same commodity of identical quantity intended for retail sale, either in individual pieces or the packages as a whole. In view of this, besides there being no evidence that these boxes containing 100 pieces were meant for retail sale, there is no evidenc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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