TMI Blog2023 (8) TMI 422X X X X Extracts X X X X X X X X Extracts X X X X ..... ration in a particular month. Abatement of Central Excise duty is restricted to the situation where the provisions of the notified goods does not take place for the period 15 days or more - it is found that in this case, since the one of the machines of the manufacturer was not engaged in the manufacture of notified goods for more than 15 days and therefore, they are entitled for abatement of the duty which has been deposited by them in advance in the beginning of the month. CBEC Circular No. 980/04/2014-CE dated 24 Jan 2014 - HELD THAT:- It is clear from the reading of the Circular that the assessee need to pay duty on deemed production in respect of per operating machine working in factory during the month taking other factors into consideration like retail sale price of the pouch etc. Therefore, since one machine of the appellant has not worked for 17 days in the month of May 2010, they are legally entitled for refund of the amount deposited by them in advance. The order-in-appeal is without any merit - appeal allowed. - MR. RAMESH NAIR, MEMBER (JUDICIAL) AND MR. C.L. MAHAR, MEMBER (TECHNICAL) Shri Rohan Thakrar, Chartered Accountant for the Appellant Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to get the benefit of abatement of above referred Rules and since one machine was in working condition and therefore refund of duty deposited in advance was denied. 2.4 The matter got adjudicated vide order dated 21.09.2010 holding that since the appellant has not followed the statutory provisions of Rule 10 in the sense that appellant have all the packing machines available in the factory for during the period of abatement and therefore, the abatement claim in the form of refund has been rejected. The appellant have made appeal before learned Commissioner (Appeals), who vide his order dated 11.10.2010 has held as follows:- 8 . In view of above, it is seen that the in terms of the provisions of SECTION 3A of the Central Excise Act, 1944 the annual capacity was determined by the JAC vide Order No. Suresh/003/2010 dated 03.05.10 and accordingly the Appellants had paid duty amounting to Rs. 17,00,000/- for two machines for the whole month of May'10 on 03.05.10. Further, in terms of the provision (3) of the section 3A, the Appellants have requested/ intimated the JAC vide letter dated 12.05.10 for sealing the one packing machine w.e.f.15.05.10. Accordingly, one Packing Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matter of record that out of two installed machines, during the month of May, the appellant had not put to use one machine in the second half of the month for 17 days in May, 2010. It is also on record that machine which was not in operation has been sealed by the department for remaining period of May 2010. There is also no denying of the fact that required amount of duty i.e. 8.50 Lakh per machine was deposited by the appellant in advance. The only question which need to be answered by us is whether for the purpose of availing abatement under Rule 10 of the said Rules, 2010, the appellant statutorily need to stop manufacturing from both the machines which are installed in his factory. Any prudent person will reach to the conclusion that only machine which is working need to pay the required amount of compounded Central Excise duty and if any machine in a month is not working for more than 15 days, as per Rule the duty deposited in advance need to be abated in their favour. Before proceeding further in this regard, it will be proper to have a look of concerned provisions of Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich such manufacturing took place : Provided also that in case a new manufacturer commences production of notified goods in a particular month, his monthly duty payable for that month shall be calculated on the pro-rata basis of the total number of days in the month and the number of days remaining in that month starting from the date of such commencement and shall be paid within five days of such commencement. Rule 10. Abatement in case of non-production of goods. - In case a factory did not produce the notified goods during any continuous period of fifteen days or more, the duty calculated on a proportionate basis shall be abated in respect of such period provided the manufacturer of such goods files an intimation to this effect with the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, with a copy to the Superintendent of Central Excise, at least three working days prior to the commencement of said period, who on receipt of such intimation shall direct for sealing of all the packing machines available in the factory for the said period under the physical supervision of Superintendent of Central Excise, in the ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xcise duty is chargeable at the rates notified on the basis of Retail Sale Price (RSP) slabs on per machine basis (notification No. 42/2008-C.E., dated 1-7-2008 and notification No. 16/2010-C.E., dated 27-2-2010 refer). In order to minimize the element of subjectivity and to ensure certainty and objectivity, the number of packing machines installed in the factory has been notified to be the only factor relevant to the production of the notified goods under the said rules. 5 . Accordingly, it is clarified that the duty payable under notification No. 42/2008-C.E., dated 1-7-2008 and notification No. 16/2010-C.E., dated 27-2-2010 may be determined based on deemed production with respect to the number of operating packing machines in the factory during the month and the Retail Sale Price printed on the pouches and not on the basis of actual production by a unit. It is clear from the reading of the above Circular that the assessee need to pay duty on deemed production in respect of per operating machine working in factory during the month taking other factors into consideration like retail sale price of the pouch etc. Therefore, since one machine of the appellant has not worked ..... X X X X Extracts X X X X X X X X Extracts X X X X
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