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2017 (6) TMI 374 - CESTAT NEW DELHI

2017 (6) TMI 374 - CESTAT NEW DELHI - TMI - Valuation - Quantity discount - includibility - Held that: - quantity discount will not be allowable for determination of duty liability u/s 4A - the appellant assessee has been following the long standing practice of granting such quantity discount to their traders. This was being mentioned in ER-1, RG-1 and invoices regularly. The records of the assessee were also being periodically audited by the Department. Consequently, any allegation of willful s .....

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estine removal - Seizure of goods at dealers premises - goods were received from the appellantís factory without payment of duty - Held that: - The seized goods are claimed to be those supplied free along with invoiced quantity. Consequently we do not find any justification for confiscation of the same at the dealerís premises - confiscation, redemption fine and penalty set aside. - Clandestine removal - Production as per input-output ratio - demand on the ground that production of goods, wa .....

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to support the charge of clandestine manufacture and clearances - without tangible evidence, charge of clandestine clearances cannot be upheld - demand set aside. - Clandestine removal - seizure at factory - Held that: - the goods said to be excess were found within the factory - since the goods remained within the factory there is no justification for seizure and confiscation of such goods - confiscation, redemption fine and penalty set aside. - The case is remanded to the adjudicating .....

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ises goods have been seized. The assessee is manufacturer of soap based cleaner, powder, naphthalene balls falling under Chapter 38 of the Central Excise Tariff. On information, their factory premises along with the premises of other traders were searched by the Departmental officers. On 12.09.2006 as a result of the search and also the investigation conducted thereafter, show cause notice dated 09.03.2007 stands issued to the assessee and other traders. The matter was adjudicated by the Additio .....

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that imposed on the partner. Aggrieved by the impugned order of Commissioner (A), the present set of appeals has been filed. All these appeals are being disposed of through this common order. 2. With the above background, we have heard Shri J.P Kaushik, Advocate the appellant and Shri R.K. Mishra, DR for the respondent. 3. The various grounds on which the impugned order has been challenged are discussed below one by one alongwith our decisions thereon: i) Quantity discount The assessee have bee .....

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the clearance of ₹ 1 crore for the purpose of availing benefit of Small scale exemption notification no. 08/2003-CE dated 01.03.2003. Duty demand of ₹ 8,97,999/- + Cess of ₹ 10,456/- stands confirmed on the above ground for the period 01.03.2003 to 12.09.2006. The submission of the appellant is that discount in any form will be allowable and even under the provisions of section 4A, such discounts will be admissible as has been held by the Tribunal in the case of Vinayak Mosquit .....

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dabad 2007 (21) ELT 20 (Tri-LB). In the terms of the Larger Bench decision quantity discount will not be allowable for determination of duty liability under section 4A. However, we find that the appellant assessee has been following the long standing practice of granting such quantity discount to their traders. This was being mentioned in ER-1, RG-1 and invoices regularly. The records of the assessee were also being periodically audited by the Department. Consequently, we are of the view that an .....

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ement available was only 35%. Appellant has submitted that the CBEC has clarified in its circular number 446/12/99-CEX dated 17.03.1999 that such goods will be rightly classifiable under 3808.90. The circular is binding on the department which cannot take a contrary view. We have gone through the CBEC Circular dated 17.03.1999. Even though the circular suggests classification of impugned goods under 3808.90, we find that the classification of these goods have been decided by the Hon ble Supreme .....

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ayment of duty. The appellant also failed to produce evidence showing the clearance of the same. The claim of the appellants before the authorities below, as well as in the present proceedings is that the goods alleged to have been cleared clandestinely and seized at the buyer s premises are the goods which were given to them under invoice as part of the free supply under the quantity discount scheme. In the above para, it has been held that quantity discount was a long standing practice of the .....

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sed on the basis of allegation that production of goods, was suppressed when it is estimated in terms of the input output ratio. Revenue has taken the view that the unaccounted production has been clandestinely cleared. This allegation is based on one consumption of the raw material, rosin . The Department, during the course of investigation determined that the basic raw material 490 kgs of rosin produces 3500 ltrs of black phenyl. This raw material consumption has also been accepted by the appe .....

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It has also been submitted that the production has been worked out for the period 01.02.2002 to 12.09.2006, but the figure has been taken from 01.01.2002 which is erroneous. They also have submitted the Chartered Accountant certificate in support of their arguments. The quantum of goods manufactured has been estimated on the basis of consumption of one raw material rosin by the department. While this course of action can give an indication as to the quantity of goods manufactured, however the s .....

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l projection of the possible production, no corroborative evidence has been produced by Revenue to support the charge of clandestine manufacture and clearances. It is settled position of law that without tangible evidence, charge of clandestine clearances cannot be upheld. In the light of this observation we conclude that the duty demand merits to be set aside on this ground. v) Seizure at Factory At the time of search of the factory by the Departmental officers on 12.09.2006, the officers notic .....

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