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2015 (4) TMI 895 - CESTAT NEW DELHI

2015 (4) TMI 895 - CESTAT NEW DELHI - TMI - Demand of differential duty - Suppression of value of goods - Inclusion of cost of cement coating and epoxy coating - Held that:- Cement coating had been got done by the appellant on job work basis through some job workers and the duty demand in respect of the value of cement coating has been dropped by the Commissioner himself and as such there is no dispute in respect of the same. - However, according to the appellant the epoxy coating had also been .....

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f whether the coating is done inside the factory or outside the factory. However, the Commissioner in the impugned order has not gone into this point for which, in our view, this matter would have to be remanded.

If the appellant had availed cenvat credit in respect of the coating material and did not include the value of the coating in the assessable value of the pipes and this fact was not specifically intimated to the Department, it would amount to suppression of the relevant fact .....

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pipes (SAW pipes) of base metal chargeable to central excise duty under heading 7308 of the Central Excise Tariff. They were availing of the Cenvat Credit of the excise duty paid on the inputs and capital goods, used in or in relation to, manufacture of their final products. The period of dispute in this case is 2002. During this period, the appellant in terms of their contract with M/s Gujarat Water Supply and Sewerage Board (hereinafter referred to as GWSSB) supplied cement coated pipes and e .....

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demanding the above duty under proviso to section 11A(1) of the Central Excise Act, 1944 also demanded interest on this duty under section 11AB and sought imposition of penalty on them under section 11AC. Beside this, the SCN also sought recovery of duty of ₹ 23,66,195/- on the freight charges not shown in the central excise invoices and recovered from the buyers and also cenvat credit demand of ₹ 1,12,061/- in respect of some inputs, which according to the Department were not admiss .....

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/- was imposed on the appellant company under Rule 25 of the central excise rule 2002. Against this order of the Commissioner, this appeal has been filed. 2. Heard both the sides. 3. Shri Manish Saharan, Advocate the Ld. Counsel for the appellant, pleaded that the duty demand of ₹ 10,82,514/- confirmed by the Commissioner is in respect of the cost of the epoxy coating which, according to the department had been done in the appellants factory, that the Commissioner, as is clear from his fi .....

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that the certain coating was being done inside the appellants factory, had not discussed the evidence on the basis of which this conclusion has been drawn by him, and that in any case, the duty demand confirmed is time barred, as while the period of dispute is 2002, the SCN had been issued on 12.07.2005 and there is no evidence to invoke longer limitation period under proviso to section 11A(1) of the Central Excise Act, 1944. He, therefore, pleaded that the impugned order confirming the duty de .....

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manufacture of coated pipes cleared to GWSSB and to what extent he stated that the appellant company has availed Cenvat Credit on the inputs used in the manufacture of coated pipes to the extent of actual material consumed in the coating activities. He also pointed out to the statement dated 23.09.2002 of Shri CB Pathak, Assistant General Manager (Marketing), wherein he has stated that there coating facilities are only a year old and their major contracts for supply of coated pipes were with GWS .....

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hat the longer limitation period under proviso to section 11A(1) has been correctly invoked and penalty has been correctly imposed on the appellant company under Rule 25 of the Central Excise Rule, 2002. He, accordingly, pleaded that there is no infirmity in the impugned order. 5. Shri Manish Saharan, in rejoinder, pointed out to the statement dated 16.10.2002 of Sh. Krishan Gopal Mantri, wherein in reply to question No. 4 as to whether duty paid by the appellant company includes the duty payabl .....

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of epoxy coating is not includable in the assessable value of the pipes. 6. We have considered the submissions from both the sides and perused the records. The appellant manufacture SAW pipes. The dispute is only in respect of the pipes supplied to GWSSB, which as per the contract were to be cement coated/ epoxy coated pipes. The cement coating had been got done by the appellant on job work basis through some job workers and the duty demand in respect of the value of cement coating has been drop .....

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