CENTRAL EXCISE SECTION

Ashoka Audyogic Swablambi Sahkari Samity Ltd Vs CCE

CX - Assessee, a registered co-operative society have put up a unit for manufacture of synthetic detergent powder - Dispute relates to eligibility of assessee for exemption under Notfn 88/1988-CE - Revenue entertained a view that assessee is a registered co-operative society with restricted validity of Patna Corporation area - As such they have no recognition as co-operative society in Sabajpura village where the excise unit is located - On this ground, proceedings were initiated to deny the exemption - The original authority confirmed duty demand and imposed equal amount of penalty on assessee - Even after the issue was brought to notice of registering authority of assessee's society, it is clear that assessee continue to be a co-operative society duly registered by competent authority - They will be co-operative society for purpose of present Notfn as said Notfn did not prescribe that registration of society also should be in area where the unit is located -

Similar disputes were examined in many other cases with reference to eligibility of exemption based on certificates issued by state authorities - In case of R.A. Cement Pvt.Ltd. Tribunal examined the validity of the claim of assessee for exemption under Notfn 175/86-CE based on certificate issued by Directorate of Industries - It is recorded that in said case certain discrepancies were brought to the notice of the Directorate of Industries - Said authority neither cancelled the certificate nor withdrew it - Accordingly based on the said certificate the excise duty concession availability should continue - Similar ratio has been followed in case of Dhar Cement Ltd. 2016-TIOL-640-CESTAT-DEL - Impugned order is not legally sustainable, accordingly same is set aside: CESTAT - Appeal allowed: KOLKATA CESTAT

2018-TIOL-431-CESTAT-AHM

Makson Ceramics Pvt Ltd Vs CCE & ST  

CX - Assessee engaged in manufacture of "Makson Brand Ceramic Tiles" - Said goods were subjected to MRP based assessments at relevant time - DGCEI had initiated investigation against manufacturers of Ceramic Tiles including assessee resulting into issuance of two SCNs dated 20.06.2008 and 10.07.2009 - On adjudication, both the said notices were decided by adjudicating authority directing confiscation of seized goods with an option to redeem the same on payment of fine and personal penalty on Shri Daudayal Gupta, Partner of M/s. D. R. Tiles, Agra; he has also confirmed the demand of duty with interest and imposed penalty under Section 11 AC of CEA, 1944 - On appeal, Commissioner (A) disposed of the appeals by remanding the matter to adjudicating authority - Though, Commissioner (A) has dropped the demand of duty, interest and penalty for period prior to 01.03.2008, however, directed confiscation of goods seized which were cleared from the factory prior to 01.03.2008, and found in the premise of the trader and seized under the reasonable belief that appropriate duty has not been paid on the said goods - Said confiscation and personal penalty on trader is erroneous and cannot be sustained - Further, since the total demand of duty has been reduced from 30,31,383/- to Rs. 4,93,093/- assessee is entitled to discharge 25% of penalty equal to the duty, subject to the fulfilment of conditions laid down under section 11AC of CEA 1944: CESTAT - Appeals partly allowed: AHMEDABAD CESTAT

Mohan Aluminium Pvt Ltd Vs CCE, C & ST

CX - Assessee is registered under Central Excise and are manufacturers of excisable goods viz. aluminium conductors - They are availing the cenvat credit facility under CCR, 2004 - During audit, it was noticed that they had wrongly taken the cenvat credit of service tax paid on Telephone Services installed at residence, Car servicing and Housekeeping service which appeared to be not eligible as per provisions of CCR, 2004 - Whether the Telephone installed at residence of Managing Director fall in definition of 'input service' - In case of Vishal Pipes Ltd. it has been held by Tribunal that the Telephone installed at the residence of Managing Director is covered by definition of 'input service' as the said Telephone is provided only for the official use and the address of the company is the residence of the Managing Director - Further the service tax paid on servicing of car as well as for housekeeping service fall in definition of 'input service' as it is in relation to business of company as held in the decision cited - Therefore, impugned order is not sustainable in law and the same is set aside: CESTAT - Appeal allowed: BANGALORE CESTAT

Raj Ratan Cactings Pvt Ltd Vs CCE

CX - Assessee engaged in manufacturing of M.S. Ingots - Factory of assessee was visited and the stock taking was done on the basis of 10 PCS of different sizes and after calculating the average basis, it was found that there is shortage of MT Ingots - It was also found that shortage of runner riser was also found on eye estimation - Sh. Mewal Das could not explain the shortages - It was alleged that assessee have cleared finished goods clandestinely without payment of duty - Assessee have challenged the method of stock taking done during course of investigation and accordingly panchnama was drawn - They also sought cross-examination of punch witnesses, which the adjudicating authority has denied - In fact for fair adjudication of case, and to ascertain how the stock taking was done, the cross examination of punch witnesses was required - Moreover, as per SCN as stated by assessee that 10 PCS of each size has been weighted and on the basis of that, the average weight has been drawn, this fact is to be ascertained from the panch witnesses whether the stock taking was done physically or on eye estimation basis - In that circumstances, matter needs examination at the end of adjudicating authority - Denial of cross-examination of panch witnesses is a gross violation of principle of natural justice - Impugned order set aside and matter remanded to adjudicating authority with a direction to first grant the cross-examination of panch witnesses to assessee and thereafter to adjudicate the matter on its own merits: CESTAT - Matter remanded: ALLAHABAD CESTAT

2018-TIOL-428-CESTAT-ALL

Shree Shyam Pulp And Board Mills Ltd Vs CCE  

CX - Assessee engaged in manufacturing Kraft paper, Writing and Printing paper and informed the Jurisdictional Central Excise Authorities that they intended to avail exemption under Notfn 49/2003-CE and from 28 January, 2004 they actually started their commercial production and cleared the goods at nil rate of duty availing said Notfn - It appeared to Revenue that there was no change in rate at which goods were being sold by assessee under DGS&D rate contracts and said goods cleared under DGS&D rate contract were inclusive of excise duty and such excise duty was collected by assessee but was not credited to exchequer therefore assessee was issued with a SCN - Said SCN very clearly indicates that invoices indicated that assessee had availed full exemption under said Notfn and there was no indication of excise duty being collected from customers - Revenue has accepted in said SCN that goods were cleared at nil rate of duty under Notfn 49/2003 - Therefore, they were not a person who were liable to pay duty under CEA, 1944 and there was no evidence which indicated that any duty paying documents established that they had collected Central Excise Duty more than they were required to pay and they were not required to pay excise duty and they did not collect more amount from purchaser in name of Central Excise Duty and therefore, provisions of Section 11D of CEA, 1944 were not applicable - What is stated in contract document for supply of goods indicating that what will be excise duty is immaterial and whether the provisions of Section 11D are invocable or not is to be examined of the basis of documents which are mentioned in Section 12A of Central Excise Act, 1944 and he has submitted that SCN has admitted that invoices have indicated that goods were cleared at nil rate of duty - Impugned order set aside: CESTAT - Appeal allowed: ALLAHABAD CESTAT

2018-TIOL-427-CESTAT-DEL

CCE Vs Miraj Products Pvt Ltd  

CX - Assessee engaged in manufacture of Lime mixed chewing tobacco - Dispute is relating to method of valuation, for Excise duty purpose, to be adopted for such products - Assessee claims that they are covered by regular transaction value based duty in terms of Section 3 r/w Section 4 - Revenue entertained a view that they are covered by Chewing Tobacco and Unmanufactured Tobacco Packing Machine Rules, 2010 r/w Notfn 14/2012 CE - The process undertaken by assessee is not in dispute - They are using one filter machine to pack filter khaini in non-woven fabric sachet with contents of 0.25 grams each, thereafter these sachets are put in paper pouches - Each pouch contains 10 such sachets - The pouch is printed with details of manufacturer, brand name and MRP; each pouch is priced at Rs. 5 - Admittedly, said pouch is a retail package intended for retail consumer - Rule 5 of said rules which determines the quantity of production based on capacity of machine as well as read with Notfn 16/2010 makes it clear that notified goods are goods which are for retail sale produced by using packing machines, as per the table mentioned therein - The explanation 5 in notfn makes it abundantly clear that for purpose of said notfn 'Filter Khaini' means chewing tobacco which is packed in sachets of filter paper or fabric before being packed in pouches with aid of packing machines' - The contention of revenue is that aid of packing machines should be for sachet and not for pouch - Tribunal is not able to appreciate such interpretation of explanation - A plain reading of explanation shows that packing in pouches should be with the aid of packing machines - In this contention, clarification issued by the board vide letter dated 53/2010 is also referred - In assessee's own case in identical situation Tribunal relying on decision of Tej Ram Dharam Paul 2013-TIOL-1192-CESTAT-DEL held that the Chewing Tobacco Rules, 2010 will not apply to assessee: CESTAT - Appeal dismissed: DELHI CESTAT

CUSTOMS SECTION