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2019 (8) TMI 381

..... goods which are sold to M/s TVC Sky Shop Ltd who, in turn, markets the products to their customers. It is also not in dispute that the brand name does not belong to the appellant-manufacturer and that it is the appellant-manufacturer who affixed the ‘maximum retail price’ on the package. The claim that such manufacture contracted with a single client is excluded from the purview of assessment under section 4A of Central Excise Act, 1944 does not stand the test of reason. It is in the nature of scheme of alternative assessment under section 4A of Central Excise Act, 1944 that the manufacturer, literally wears his intent on his sleeve and the marking of the maximum retail price on the product is the surest indicator of the goods b .....

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..... o belong to an entity that was not entitled to such exemption. The goods were also held to be liable to duty at the retail selling price netted for the abatement prescribed in notification issued under section 4A of Central Excise Act, 1944. Accordingly, the original authority confirmed the differential duty of ₹ 5,23,674/- on the clearances effected between July 2004 and January 2005 as well as on the goods seized at the premises of M/s TVC Sky Shop Ltd. The seized goods were confiscated but permitted to be released on discharge of redemption fine of ₹ 51,000/-. In addition, penalties were imposed on the manufacturer, as well as the owner of the brand name, under rule 25 and rule 26 of Central Excise Rules, 2002. The first appe .....

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..... eliance on paragraph 6 and 7, was relevant to the bar of limitation. 3. Learned Authorised Representative contends that appellant had no locus standi to raise a challenge to valuation as these have been conceded before the lower authorities and that such a challenge could not be brought up for the first time before the Tribunal. He placed reliance on the decision of Jayanti Food Processing (P) Ltd v. Commissioner Of Central Excise, Rajasthan [2007 (215) E.L.T. 327 (SC)]. He also contends that the decision in re Omni Protect Drugs Pvt Ltd would not apply to the present case as the issue in dispute therein was the valuation system to be adopted on clearance of physician s samples. Here the manufacturer cannot claim that the activity was being .....

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..... ve assessment under section 4A of Central Excise Act, 1944 that the manufacturer, literally wears his intent on his sleeve and the marking of the maximum retail price on the product is the surest indicator of the goods being intended for the retail customer. This clear manifestation of intent on the part of the appellant must inevitably lead to duty liability in accordance with section 4B of Central Excise Act, 1944. 5. Naturally such a resort is contingent upon non-eligibility for the exemption available to small scale unit under notification no. 8/2003- CE dated 1st March 2003. The appellant is a manufacturer and the brand/logo is not theirs. There is no evidence on record that contract purchaser, the supplier of brand name/logo, is entit .....

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..... section 11AC was not option offered by the original authority or extended by the first appellate authority. We find the Hon'ble Supreme Court in Commissioner of Central Excise & Customs v. RA Shaikh Paper Mills P Ltd [2016 (335) ELT 203 (SC)] has held that it was mandatory for adjudicating authority to include such option within the order the option to reduce penalty. Such an option was not given at the two lower stages. This must be corrected. 9. For the reasons highlighted above, we uphold the confirmation of duty liability, the confiscation of goods along with imposition of penalty, fine thereon for redemption as well as penalty under section 11AC of Central Excise Act, 1944. However, we also extend the privilege of reduced paym .....

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