TMI Blog2013 (7) TMI 1015X X X X Extracts X X X X X X X X Extracts X X X X ..... t to their Bombay factory to be used by them as inputs for their final product, dispensing pump sets. The dispute in the present appeal relates to the assessable value of the said metering units and suction units cleared by the appellant to their Bombay unit and the consequent demand of ₹ 85,83,356/-. 2. As per facts on record, the show cause notice issued on 30.09.91 was adjudicated by the Commissioner vide his order dated 27.3.92 dropping the demand of duty as barred by limitation. It was observed in that order by the adjudicating authority that appellant has been filing classification list as well as price list and everything was in the knowledge of the Revenue. The said order of the Commissioner was appealed against by the Revenue and the matter was remanded by the Tribunal for fresh adjudication. The present impugned order stands passed by the adjudicating authority in remand proceedings, confirming the demand against the assessee as also imposing penalties upon the appellants. 3. After hearing both the sides duly represented by Shri Anand Nainawati, learned advocate, appearing for the appllant and Shri Avinash Thete, learned DR, appearing for the Revenue, we note ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issue is Revenue neutral and the demand should not be confirmed on the said count. Reference in this regard is made to Tribunal's decision in case of M/s. P. T. C. Industries v .CCE, Jaipur - 2003 (159) E.L.T. 1046 (Tri. - Del.) as also in case of M/s. MRF Limited V. CCE 2004 (170) ELT 69 (Tri. - Bang.) and in case of CCE, Daman V. M/s. Rishi Packers, 2007 (80) RLT 181 (CESTAT-Ahbad.). Even Hon'ble Supreme Court in case of CCE Vs. M/s. Coca-Coda India Pvt. Ltd. 2007 (213) ELT 490 (S. C.), has held that Excise duty parable on the beverage bases/concentrates and Modvat credit available to the assessee being identical, consequence of payment of excise duty after availing Modvat credit was Revenue neutral, in view of which confirmation of demand was not justified. 5. By applying ratio of the law as available in the above referred judgments we find no justification in confirmation of demand for imposition of penalty against the appellant and set aside the same. Accordingly the impugned order is set aside and appeal allowed with consequential relief to the appellants. (Pronounced in Court on ____________) PER : B.S.V.. Murthy, Mr. 6. I have gone through the order p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accounts of expenditure incurred on stamps and other postal expenses are maintained by all government departments. Even though this results in putting money from one pocket of the same person to another pocket of the same person, government continues to do this. A government which does not exempt its own department for payment for the services rendered on the ground of revenue neutrality and on the ground that there cannot be payment by the person who is receiving the service to the same person who is providing the service only because they happened to be two parts of the same person, question arises whether we can justify revenue neutrality when payment is made by a person to the government and when other person takes credit and uses it only because situation becomes revenue neutral. 11. When such is the situation, I am unable to understand why the government should not recover the amount from one unit when goods are cleared to another unit of the same factory when as per law, central excise duty is required to be discharged after payment of duty on the value determined at the time and place of removal. A relief from the statutory liability on the ground that the credit is avai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e credit and pay more duty on the final product is that there was no intention to evade duty by under declaring the value because by under-declaration, the assessee does not gain any benefit. In such a situation naturally the department may have to show that there was an intention to evade duty which could probably be done by showing that the goods are diverted. Of course there could be other modus of operandi adopted which can show intention to evade payment of duty. Therefore unless intention is shown by evidence, the benefit would go to the assessee as regards revenue neutrality. Therefore in a revenue neutral situation unless department is able to show suppression of facts/misdeclaration as provided under Section 11A, extended period cannot be invoked. Therefore whether extended period can be invoked or not has to be determined on a case to case basis. In this case: there is no evidence produced by the department to show that assessee had an intention to evade payment of duty by under declaring the value. Therefore extended period cannot be invoked in this case. 15. Once extended period cannot be invoked, penalty under Section 11AC also cannot be justified and sustained. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equent to the confirmation of demand would be available as credit thereby bringing no relief to the department, there is no point in confirming the demand. While the courts can apply the principle equity justifies bending the rules/procedure, where no specific provision or fairplay is violated, with a view to promote substantial justice , Tribunal which is a creation of a statute cannot ignore the rule of law and go by equity. In fact even the observations of the Supreme Court wherein it has been stated where no specific provision or fairplay is violated , shows that there should be no violation of any specific provision. In this case when the goods were undervalued at the time of clearance, there was definitely a violation of the provisions of Section 4 of Central Excise Act, 1944. Therefore this judgment is definitely not applicable. 20. Similarly the decision of the Hon'ble High Court of Kerala in the case of Commissioner of Agricultural Income Tax Vs. Amalgamated Tea Estates Co. Ltd. [1970 ITR (Vol.77) pg.455 (Ker)] is also not applicable since in that case it was held that the principle that subsequent events can be taken into consideration by a Court in granting reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... demand was set aside on the ground that a show cause notice on the same ground had been issued in 1996 and therefore another show cause notice invoking suppression could not have been issued. In the case of Essel Propack Ltd. reported in 2009 (237) ELT 497 (Tri. - Ahmd.) the appellants had submitted that proceedings for denial of credit on the basis of supplementary invoices issued by the sister unit had been initiated and set aside subsequently by the departmental officers on the ground that there was no suppression at the end of manufacturing unit. This shows that in that case also demand was set aside on the ground of limitation. In the case of Mafatlal Industries Ltd. reported in 2009 (241) ELT 153 (Tri. - Ahmd.) also, even though period covered by the show cause notice had not been indicated, the facts discussed shows that penalty equal to duty had been imposed thereby revealing that extended period had been invoked. In the case of Gujarat Glass Ltd. reported in 2009 (242) ELT 254 (Tri. - Ahmd.) show cause notice was issued on 08.10.02 whereas the appellants had paid the duty on moulds on 23.03.00. Therefore this case was also one of application of extended period. The case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that was also a case of revenue neutrality. 24. The discussion of all the cases cited by the learned advocate above and the decisions by Hon'ble Supreme Court show that none of the decisions support the contention that demand which is within the limitation period cannot be confirmed and it need not be paid only because the credit is available at the other end. 25. In view of the above, the impugned order has to be set aside and the matter remanded to the original adjudicating authority to recalculate the demand which is within the normal period of limitation. It is made clear that no penalty would be leviable on any of the appellants in view of the fact that extended period has been held to be inapplicable. The sister unit would also be eligible for the credit of duty paid, if appellants pay duty. As regards interest liability, the original adjudicating authority shall examine the issue in accordance with law. Needless to say the appellants shall be given an opportunity to present their case if they desire to do so before the adjudication proceedings are completed. DIFFERENCE OF OPINION Whether the demand for the normal period of limitation without invoking extended ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tenneco RC India Pvt.Ltd. Vs CCE Chennai 2009 (235) ELT 105 (Tri) b) Essel Propack Ltd. Vs. CCE Daman 2009 (237) ELT 497 (Tri. c) Pasupuleti Venkateswarlu Vs The Motor General Traders AIR 1975 S.C. 1409 d) Gopal Zarda Udycg Ltd. Vs. CCE 2001 (128) ELT 409 (Tri.) e) Hindustan Zinc Ltd. Vs. CCE 2008 (232) ELT 687 (Tri.) f) CIT Vs. Ramanand Sachdeva (1982) 136 ITR 440 (Del.) g) Commissioner Vs. Indian Iron Steel Co. Ltd. 2013 (287) ELT 89 (Tri-Bang) h) Piom Industries Vs. CCE Ahmedabad 1995 (77) ELT 424 (Tri) 4. It is also his submission that since the Mumbai unit is now closed down, the relief needs to be moulded in such a way that the appellant is not put to any hardship. It is his submission that the judgment of the Tribunal it the case of Piom Industries - 1995 (77) ELT 424 (Tri) will apply in this case. 5. Ld. Additional Commissioner (A.R.), on the other hand, would rely upon the decision in the case of I M Power Ltd - Final Order No.A/1654/WZB/AHD/2011, dt. 18.12.2008, and submits that in the said decision, the Bench has held that the demand of the duty liability within the limitation can be raised and confirmed against the assessee, even if the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tificates produced by them in pursuance granting the benefit of Notification No.108/1995. The said certificates are admittedly cancelled by the project implementing authority. If that be so, then the provisions of Section 11A(1) will apply in full force in this case. 14. As regards the various judgments relied upon by the ld. Counsel to submit that in this case, there cannot be any duty liability. I find that in those cases, the issue and the facts were totally different. In the case in hand, it is undisputed that the provisions of Section 11A(1) would be applicable for the clearances made from the factory premises. In those cases, the issue was regarding cancellation/licences which were produced before the authorities for the clearances and mostly in respect of consignments which were imported. As regards the reliance placed by the Id. Counsel on the judgment of the Hon'ble Supreme Court in the case of Vadilal Industries, I find that the said judgment is in respect of an issue under the Sales Tax, wherein the provisions were not pari materia to the provisions of Section 11A(1) of Central Excise Act, 1944, as it stood during the relevant period. 15. At this junc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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