Custom, Excise & Service Tax Tribunal
Yes vs Represented By : Shri S.R. Dixit, ... on 31 May, 2010
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Zonal Bench, Ahmedabad Appeal No. : E/1508 of 2009 (Application No. E/S/1630 of 2009) Arising out of : OIA No. Commr(A)/200/VDR-I/2009 dt. 25.8.2009. Passed by : Commr. (Appeals), C.Ex. & Cus., Vadodara For approval and signature : Hon'ble Mrs. Archana Wadhwa, Member (Judicial) Honble Mr. B.S.V. Murthy, Member (Technical) 1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3 Whether their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes Appellant (s) : M/s. Alembic Limited Represented by : Shri S.R. Dixit, Advocate Respondent (s) : Commissioner, C. Excise & Cus. Vadodara
Represented by : Shri Avinash Thete, SDR CORAM :
Hon'ble Mrs. Archana Wadhwa, Member (Judicial) Honble Mr. B.S.V. Murthy, Member (Technical) Date of Hearing : 31.05.2010 Date of Decision : 31.05.2010 ORDER No. _____________ /WZB/AHD/2010 Per : Mrs. Archana Wadhwa, After dispensing with the condition of pre-deposit of duty of Rs. 20,76,981/- and penalty of identical amount, we proceed to decide the appeal itself, inasmuch as we find that the issue is covered with the precedent decision of the Tribunal.
2. Appellants are engaged in the manufacture of pharmaceutical products. Dispute in the present appeal relates to the assessable value of the physician samples distributed free of cost. Learned advocate appearing for the appellants fairly agrees that the issue on merits stands decided against them by the Larger Bench decision of the Tribunal in the case of Cadila Pharmaceuticals Limited 2008 (232) ELT 245 (Tri.- LB). However, he assails the impugned demand on the ground of limitation by submitting that the period involved is April 2005 to 31 March 2007, whereas the show cause notice was issued on 01.5.2008. By relying upon the Tribunal decision in the case of M/s. Marsha Pharma Pvt. Limited being order No. A/1125/WZB/AHD/2009 dated 01.6.2009, learned advocate submits that the demand in that case was held barred by limitation on the ground that the matter was referred to the Larger Bench and the issue was not free from doubts. As such, he submits that the entire demand is beyond the period of limitation, the appeal be allowed on the ground of time-bar.
3. After hearing the learned DR, who support the impugned order on the ground of invocation of longer period, we find that the Tribunal in the above referred judgment of M/s. Marsha Pharma Pvt. Limited, observed as under :-
3. We have considered the submissions made by both the sides. We find that the Commissioner (Appeals) has considered the submissions that the issue was referred to Larger Bench in April 2008. He however, states that period involved in this case is from April 2005 to Jan 2007 and issue already stood clarified by the Board Circular dated 25.4.2005. Even after the clarification given by the Board, appellants continued to follow the practice and therefore he justifies the demand of duty and imposition of penalty etc. However, very fact that the matter was referred to the Larger Bench in April 2008 by the Tribunal shows that even after issue of circular by the Board, the matter was not settled finally since there were contradictory views. While the Hon'ble Supreme Court has held that circulars beneficial for the assessee are bound to be implemented by the officers of the department, there is no such law laid down by the Hon'ble Court that the circular issued by the Board is binding on the assessees as well as on the Tribunal. Therefore, it cannot be said since Board issued a circular the assessee is not entitled to entertain an opinion which is different from the circular issued. Further the very fact that Boards circular issued in 2002 was modified in 2005 shows and also the fact that both the circulars were issued after introduction of new Rules shows that different interpretations were possible. When different interpretations were possible, extended period cannot be invoked and penalty cannot be levied. Therefore, we allow the appeal as far as the demand beyond the period of one year and we also set aside the penalty imposed on the appellants. The matter is remanded to Original Adjudicating Authority for the limited purpose of working out duty demand within limitation period of one year under Section 11A of Central Excise Act, 1944.
4. As the Bench has observed that the extended period would not be invoked in cases where the matter is referred to the Larger Bench and has also discussed the effect of the Circular issued by the Board (which has been made the basis for invoking longer period in the present case). By following the same, we held that demand in the present case is also barred by limitation. Accordingly, the impugned order is set aside and appeal is allowed. Stay petition as also appeal get disposed off.
(Pronounced in the Court) (B.S.V. Murthy) (Archana Wadhwa) Member (Technical) Member (Judicial) KLAReg