Customs, Excise and Gold Tribunal - Delhi
Chemicals And Plastics India Ltd. vs Collector Of Central Excise on 18 September, 1991
Equivalent citations: 1991ECR344(TRI.-DELHI), 1993(67)ELT307(TRI-DEL)
ORDER P.C. Jain, Member (T)
1. When the case was called, none has appeared on behalf of the appellants, who have vide their letter dated 14th June 1991 requested for a decision on merits without personal hearing.
2. Brief facts of the case are as follows :-
The appellants herein were availing the Exemption Notification No. 198/76, dated 16-6-1976 with effect from 24-1-1978. The said Notification granted an exemption of 25% of the duty otherwise leviable on the products manufactured and removed by the appellants. The appellants continued, to remove the goods, even after availing of the benefit of the said Notification, on the same price to its customers as it was doing before availing of the said Notification prior to 24-1-1978. In other words, even though the duty being paid by the appellants to the Department was less after 24-1-1978, the appellant continued to charge the same cum-duty price as he was charging from his customers before 24-1-1978. Since the appellant .was now paying less duty to the Department in view of the Notification 198/76, dated 16-6-1976, the Department sought to revise the assessable value by giving a lesser amount of abetment of duty after taking into consideration the benefit of exemption under the said Notification. This led to re-determination of the assessable value at a higher level causing thereby higher collections of duty by the Department. Later on, however, the appellant herein filed three refund claims for the excess duty paid as aforesaid during the period 24-1-1978 to 31-3-1978. These refund claims were rejected by the original authority that the re-determination of assessable value by the Department was correct in law as per section 4 of the Act and this was also made clear in a Press Note issued by the Government and a Trade Notice issued by the Collector based on that Press Note. The lower appellate authority also did not accept the contention of the appellants. Hence this appeal.
3. The appellant's main contention is that the Notification 198/76, dated 16-6-1976 did not contemplate passing on the benefit of the said exemption to the customers and therefore, he was not bound to do so. Accordingly, there could not be any re-determination of assessable value even if he did not pass on the benefit of the said Notification to its customers. The Press Note and Trade Notice referred to by the original authority did not have the sanction of law and support thereon was, therefore, illegal. In support of the aforesaid proposition, the appellants have relied upon Delhi High Court's decision in the case of Modi Rubber Limited v. Union of India [Civil Writ Petition No. 411/77 -1978 (2) E.L.T. (1127) (Del.)] and two similar decisions of the same High Court in the case of Madras Rubber Factory v. Union of India [C.W.P. No. 501/78 -1979 (4) E.L.T. (J173) (Del.)] and Chemicals and Plastics India Limited v. Union of India (C.W.P. No. 147/79). In these premises, the appellant had urged in its revision application which is now as an appeal before us that their refund claims be allowed.
4. Opposing the pleas made in the revision applications by the appellant, the learned Sr. D.R. for the revenue has urged that this matter is no longer res-integra in view of a number of decisions of the Tribunal as well as of some High Courts. He submits that the decision of Delhi High Court in the case of Modi Rubber Limited referred to by the appellants in its revision application was rendered before the retrospective amendment of law made by Section 47 of the Finance Act, 1982 (14 of 1982) by inserting an explanation in clause (d) of Sub-Section (4) to section 4 of the Central Excises and Salt Act, 1944. The effect of the said amendment is from 1-10-1975. The following judgments have been relied upon by him in support of the Department's case regarding re-determination of assessable value in terms of theSub-Sectionsection (4) as amended by section 47 of the Finance Act, 1982.
(1) 1984 (18) E.L.T. 701 (Bom.) (B.K. Paper Mills (Private) Limited v. Union of India);
(2) 1987 (32) E.L.T. 684 (A.P.) (ACCE v. Andhra Pradesh Paper Mills);
(3) 1990 (48) E.L.T. 182 (Bom.) (Tata Engineering and Locomotive Company Limited v. ACCE).
In view of the aforesaid decisions, the learned Sr. D.R. for the Revenue has urged that the appeal be dismissed.
5. We have carefully considered the pleas advanced on both sides. We agree with the learned Sr. D.R. in view of the retrospective amendment to Section 4 of the Central Excises & Salt Act by Section 47 of the Finance Act, 1982 (14 of 1982), the legal position is now beyond doubt. It is only the effective duty of excise payable by an assessee which is liable to be deducted from the cum-duty price realised by an assessee from its customers. In that view, the duty payable by the appellant after taking into consideration the effect of Notification 198/76 only will have to be abated from the cum-duty price for arriving at the assessable value in terms of Section 4 of the Act. The judgment of Delhi High Court in the case of Modi Rubber Limited is no longer a valid law, in view of the change in legal position made by Act 14 of 1982 mentioned supra. Reliance placed by the learned Sr. D.R. on the citations mentioned above is correct. The latest judgment of Bombay High Court relied upon by the learned Sr. D.R. in the case of TELCO mentioned supra is a very exhaustive judgment dealing with the entire case law as it was before the amendment of section 4 and that judgment was rendered after the amendment of Section 4. Following respectfully the aforesaid decision, we dismiss the appeal.