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2015 (6) TMI 622 - MADRAS HIGH COURT

2015 (6) TMI 622 - MADRAS HIGH COURT - 2015 (322) E.L.T. 234 (Mad.) - Duty demand - Violation of Section 11D - Whether the duty demand made under Section 11D of Central Excise Act, 1944 as made out in the Show Cause Notice is correct or not, inasmuch as duty has been charged on the value as per Section 4 of the Central Excise Act, 1944 and the goods removed on invoices as per Rule 11 of Central Excise Rules, 2002 - Held that:- First respondent/assessee were supplying cylinders through open tende .....

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facts and records and after perusing the statements given before the Central Excise Officers, held that the first respondent/assessee had not collected in excess of over and above what was paid. It is to be noted that the Department had not disputed the eligibility of the SSI exemption availed by the first respondent/assessee and there is no proposal to deny the SSI exemption. When such being the case, because of the error committed by the clerk in generating the invoice, the first respondent/a .....

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us Appeal is filed by the Department as against the order dated 25.07.2014 made in Final Order No.40425 of 2014 on the file of the Customs, Excise and Service Tax Appellate Tribunal, Chennai raising the following substantial questions of law: a. Whether the order of the Tribunal in holding the breakup figures of Excise Duty shown in the invoices issued under Rule 11 of Central Excise Rules, 2002 as a genuine clerical error is correct or not? b. Whether the duty demand made under Section 11D of C .....

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on Ltd. through a open tender. They have opted for SSI exemption for the financial year 2005-06 under Notification No.8/2003 and cleared the goods at 'Nil' rate of duty and on crossing the SSI exemption limit, they cleared the goods on payment of appropriate Central Excise Duty. Alleging that the first respondent had collected excise duty during the period from 01.04.2005 to 14.05.2005 from M/s.IOCL, but failed to remit the same to the Government Account while availing SSI exemption unde .....

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emand was made based on the invoices and based on statutory documents and based on the statutory returns filed by the assessee to the Department. There was no allegation in the Show Cause Notice to the effect that the assessee suppressed the facts. Accordingly, he came to the conclusion that except the erroneous invoice, no amount in excess of the Net Delivered Price (NDP) of ₹ 300/- was collected. This amount was the amount payable on reconciliation while availing exemption and even after .....

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xemption limit, they started paying excise duty by availing the Cenvat Credit available to them. At that time they had programmed their computer to print invoice showing the excise duty component also. At the beginning of the year 2005-2006, they have exercised their option to avail the value-based exemption under Notification No.8/2003. But due to negligence on the part of their staff, the invoices issued after 01.04.2005 and upto 14.05.2005 continued to show the excise duty component. On cross .....

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g the Cenvat Credit available to them; exercised their option at the beginning of 2005-06 to operate under SSI scheme; and started paying duty by availing Cenvat Credit once they crossed the exemption limit after 14.05.2005. All the above acts are conscious decisions on the part of the appellant after understanding the provisions of the law and what occurred was only a mistake in the preparation of the invoice by filling up the column excise duty even when availing the exemption. The above posit .....

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dit amount available to them for utilization. So they charged and collected nothing extra and hence are not liable to pay duty to warrant invoking of the provisions of Section 11D of the Central Excise Act, 1944. 3. Not satisfied with the order of the Commissioner (Appeals), the Department pursued the matter before the Tribunal, which was rejected by the single Member of the Tribunal concurring with the view of the Commissioner (Appeals) primarily on the ground that there was no material to show .....

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xemption under Notification 8/03. Further, the first respondent entered into a contract with IOCL for manufacture and supply of LPG cylinders and as per the said contract and the price is fixed on NDP basis. It is also noticed that the first respondents after crossing the SSI limit during the relevant period, i.e. 14.5.2005, started paying duty from 15.5.2005 onwards. It is not a case here that first respondent have collected in excess of excise duty over and above what was paid. I also find tha .....

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y excess amount over and above the price of the cylinder which is fixed at NDP by IOCL which is inclusive of excise duty. The first respondent had charged only ₹ 300/- while availing the exemption and continued to charge ₹ 300/- even after cross the exemption limit. The clerical error, in the consolidated invoices showing break up of excise duty appears to be genuine as the revenue has not disputed the eligibility of SSI exemption. The case law relied by the revenue in the case of Ki .....

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