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TMI Blog2023 (5) TMI 720X X X X Extracts X X X X X X X X Extracts X X X X ..... on payment of duty for usage in the manufactureof their final products namely aluminium ingots and coils. These goods are further stock transferred by the Appellant to Mauda, Taloja and Belur Units on payment of duty. In the said units, the aluminium ingots and coils are further processed and the final product i.e. Aluminium Sheets and foils, are manufactured and cleared on payment of central excise duty. 2. During the period April 2009 to March 2010, the Hirakud Unit cleared aluminium ingots and coils to the said sister units upon payment of excise duty, on the basis of 110% of the estimated cost of production (as per the previous year's CAS-4 statements adjusted for inflation and forecast of price increase in the current year). At the end of the year, when the final cost of production was worked out for the FY 2009-10, it emerged that the Appellant had on an overall basis, paid excise duty on the value which is much more than 110% of the cost of production. Thus, the Appellant was of the view that they were not liable to pay any differential liability. 3. However, the department noticed that if the final CAS-4 figure is applied for every month of the year 2009-10, there would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d impugned order preferred the present appeal before this Tribunal on the following grounds :- 7.1 The Appellant submits that during the relevant period excess duty of Rs.34,45,235/- was paid in respect of coils and Rs.2,05,16,847/- in respect of ingots. However, in spite of the conspicuous excess payment of duty much more than the alleged short payment of duty in the impugned order, the impugned order has not adjusted the same and has erroneously confirmed the demand by totalling the short payments alone and ignoring the excess payment of duty made by the Appellant. 7.2 The Appellant submits that it is a settled principle of law that in cases where both excess and short payment of duty exists for any particular period, adjustment of duty must be allowed and any duty if further remains unpaid can only be demanded. They submitted that ignoring the duty paid in excess and raising a demand only in respect of cases where duty has been short paid shall lead to situation where excess and undue duty would be retained by the government which is in violation of the mandate of Article 265 of the Constitution of India. 7.3 The Appellant submits that adjustment of duty has been allowed all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o evade payment of duty. In this case, the department has not furnished any evidence as to how the Appellant suppressed any facts. The entire demand has been raised from the records periodically submitted by the Appellant before the Central Excise Authorities. Therefore, the demand cannot be sustained on the allegation of non-submission of information which is not even required to be submitted as per law. This view is supported by the following decisions: a. Apex Electricals v. Union of India [1992 (61) ELT 413 (Guj.)]; b. Prolite Engineering Co. v. UOI 1995 (75) ELT 257 (Guj.)] 9. The Appellant further submits that in cases which are revenue neutral in nature, there cannot be any intent to evade payment of duty. Thus, extended period of limitation cannot be invoked in such cases. This view is supported by the following decisions: a. Daman Ganga Board Mills Pvt.Ltd. v. CCE, Daman, Vapi [2012 (276) ELT 532(Tri.Ahmd.)]; b. Rajasthan Udyog v. CCE, Jaipur [2012 (279) ELT 410 (Tri.-Del.)] 10. In light of the above submissions, the Appellant stated that the impugned order is bad in law and is not sustainable. Further, as no demand can be sustained against the Appellant, no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rule 8 of the Central Excise Valuation Rules, 2000 following the Cost Accountant Standards (CAS-4). It is not in dispute that valuation has been done properly as per CAS-4. However, such valuation has been done on the basis of CAS-4 certificate prepared on the basis of annual cost of production. The appellant has paid duty on a month to month basis on the basis of the cost of the goods for the previous month. When the valuation is finalised on an annual basis, there has been short payment of duty in some months as well as excess payment in other months. The appellant has already paid the excess duty wherever the value as per CAS-4 is more than the value adopted for payment of duty, but after adjusting the excess paid duty in other months. Such adjustment has not been permitted by the adjudicating authority even in the de novo adjudication. 8. We are of the view that the stand taken by the adjudicating authority is untenable. An identical issue has been considered by the Tribunal in the case of Essar Steel India (supra), in which the Tribunal observed as follows : "5. We have heard both the sides and perused appeal records including written submission. The admitted facts o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the costing applying CAS-4 and the assessable value in terms of Rule 8 of Valuation Rules final determination of duty liability has to be made. In the present case, admittedly no provisional assessment was resorted to by the appellant. Hence, the determination of actual cost much later on the clearance resulted in certain adjustments and payments by the appellant. 8. The appellants referred to guidelines issued by the institute of Cost & Works Accountants of India on CAS-4. We have perused the same. Para 8 deals with periodicity of CAS-4 Certificates. The guidelines state that the frequency of revising the certificate of cost of production will depend upon the significance in the changes in the cost due to various factors like input cost fluctuations, changes in the employee cost and other expenses. It further notes that where goods are cleared on cost of production worked out as per the audited accounts of the previous audited period, it is advisable to prepare a fresh certificate of cost of production based on the audited accounts of the period for which the goods are cleared and the differential duty is paid or taken credit of as the case may be. In such circumstance, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ances were below such cost price is not legally sustainable." 10. The appellant has claimed that they have already paid the short-paid duty payable after deducting adjusting the excess. The adjudicating authority is directed to verify the same and recover only the differential, if any, after such adjustment." b. M/s. Finolex Industries Ltd. v. Commissioner of Customs-Pune [EA- 1540/2012 Order No.A/85967/2022-CESTAT MUMBAI] - wherein it has been held as under:- "4.3 Undisputedly Appellants submitted the CAS-4 certificates along with their ER-1 returns. The CAS-4 certificate mentions that valuation was done on the basis of previous year's figures and adjustment on account of inflation was done. They had adopted the above method of valuation since July 2000 when Valuation Rules, 2000 were introduced. As per chapter 6.8 of ICWAI guidelines, the cost of production can be determined on the basis of previous quarterly result also. The Appellants have appropriately taken cost figures of the previous month's CAS-4 certificates as a basis to arrive at the cost of production of each month. There was no objection whatsoever by the department at any point of time. For the first time in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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