Custom, Excise & Service Tax Tribunal
Cce, Delhi Iv vs Consumer Healthcare Ltd on 12 February, 2015
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Block No. 2, R.K. Puram, New Delhi 110 066. Principal Bench, New Delhi COURT NO. III DATE OF HEARING : 01/01/2015. DATE OF DECISION : 12/02/2015. Excise Appeal No. 1111 of 2006 [Arising out of the Order-in-Appeal No. 115-CE/Appl/DLH-IV/ 2005 dated 10/11/2005 passed by The Commissioner (Appeals), Central Excise, Delhi IV, Faridabad.] For Approval and signature : Honble Shri Rakesh Kumar, Member (Technical) Honble Shri S.K. Mohanty, Member (Judicial) 1. Whether Press Reporters may be allowed to see : the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? 2. Whether it would be released under Rule 27 of : the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordships wish to see the fair : copy of the order? 4. Whether order is to be circulated to the : Department Authorities? CCE, Delhi IV Appellant Versus M/s Glaxo Smithkline Beecham ] Consumer Healthcare Ltd. ] Respondent
Appearance Shri R.K. Grover, Authorized Representative (DR) for the appellant.
Shri B.L. Narasimhan, Advocate for the Respondent.
CORAM : Honble Shri Rakesh Kumar, Member (Technical) Honble Shri S.K. Mohanty, Member (Judicial) Final Order No. 50322/2015 Dated : 12/02/2015 Per. Rakesh Kumar :-
The respondent are engaged in packing of Horlicks and Boost falling under sub-heading 1901.19 of the Tariff and their activity amounted to manufacture. Their sales were through sales depot located all over the country. The period of dispute in this appeal is from April 1994 to July 1997. The appellant during this period were having different prices for their different depots and one of the point of dispute was as to whether the price at the respective depots should be adopted as assessable value in respect of the goods sold through those depots or whether the sale price at the nearest depot should be adopted as the assessable value. Another point of dispute is deduction of turnover tax, depot expenses and cash discount. These issues were decided by the Commissioner (Appeals) vide order-in-appeal dated 24/07/98 by which she held that
(a) depot price for each depot should form the basis for arriving at the assessable value in respect of clearances to that particular depot ;
(b) deduction of turnover tax and deduction of discount to hospitals and nursing homes is permissible in view of the Apex court decision in the case of Bombay Tyre International 1994 (17) E.L.T. 329 ; and
(c) deduction of the depot expenses is not permissible. Having decided these issues, the Commissioner (Appeals) directed that the quantum of demands are to be re-worked out as per the decision in the order-in-appeal. Accordingly, the Jurisdictional Assistant Commissioner vide order-in-original dated 29/03/2005 confirmed the duty demand of Rs. 4,26,626/- in respect of depot expenses and duty demand of Rs. 7,32,141/- in respect of sales through depots at Ghaziabad, Varanasi and Delhi. Though the re-quantification of duty demand, which was covered by 8 separate show cause notices resulted in duty amounting to Rs. 86,54,690/- in respect of the depots in Uttar Pradesh for the period from April 1994 to July 1997 being refundable, the Assistant Commissioners order is silent about it. The order, however, mentions that the respondent had by themselves calculated that they were entitled for refund of Rs. 1,23,82,872/- and had applied for refund to the Deputy Commissioner who vide order-in-original dated 05/1/2000 had rejected the refund claim and this order of the Deputy Commissioner was upheld by the Commissioner (Appeals) vide order-in-appeal dated 28/11/03 and they did not file any further appeal against the order dated 28/11/03 of the Commissioner (Appeals), as they were afraid that the claim may be hit by unjust enrichment. Probably for this reason only, the Assistant Commissioner in his order dated 29/3/05 confined himself only to the confirmation of the duty demand of Rs. 4,26,626/- and Rs. 7,32,141/- totalling Rs. 11,58,767/-. The respondent filed an appeal to Commissioner (Appeals) against this order and the Commissioner (Appeals) vide order-in-appeal dated 10/11/05 ordered adjustment of the duty demand of Rs. 11,58,767/- against the excess payment of duty of Rs. 86,54,690/-. Against this order of the Commissioner (Appeals), the Revenue is in appeal.
2. The appeal is mainly on the ground that since the assessment during the period of dispute were not provisional and as such Rule 9B of the Central Excise Rules, 1944 was not applicable, there was no authority for adjustment of the short payment of Rs. 11,58,767/- determined by the Assessing Officer against the excess payment of Rs. 86,54,690/-.
3. Heard both the sides.
4. Shri R.K. Grover, learned DR, assailed the impugned order by reiterating the grounds of appeal in the Revenues appeal and pleaded that since the assessments during period from April 1994 to July 1997 were not provisional and as such the provisions of Rule 9B of the Central Excise Rules, 1944 were not applicable, there was no authority for adjustment of the short payment of Rs. 11,58,767/- against the excess payment of Rs. 86,54,690/- and as such this adjustment is not permitted under the law, that the respondent in pursuance of the order-in-appeal dated 24/7/98 had filed a refund claim of Rs. 1,23,82,872/- and the amount of Rs. 86,54,690/- is included in this amount, that this refund claim had been rejected by the Assistant Commissioner vide order-in-original dated 05/1/2000 and the appeal filed by the respondent against this order to Commissioner (Appeals) had been rejected by the Commissioner (Appeals) vide order-in-appeal dated 28/11/03, that no appeal has been filed by the respondent against the Commissioner (Appeals)s order upholding the rejection of the refund claim, that for this reason only, the Assistant Commissioner in the order dated 29/3/05 has confined himself only to the duty demand of Rs. 11,58,767/-, that when the Assistant Commissioners order dated 29/3/05 was silent about the refund issue for the reason that this issue has been decided by the Commissioner (Appeals) against the Assessee and this order dealt only with the confirmation of duty demand of Rs. 11,58,767/-, there was no justification for the Commissioner (Appeals) to order adjustment of the duty demand of Rs. 11,58,767/- against the refund of Rs. 86,54,690/-, and that in view of this, the impugned order is not correct.
5. Shri B.L. Narasimhan, Advocate, the learned Counsel for the respondent, pleaded that though there was no formal provisional assessment order during the period of dispute, the assessments have to be treated as provisional, that while finalising the provisional assessment, the excess payment of duty is required to be adjusted against short payment and in this regard the bar of unjust enrichment does not apply, that in this regard, he relies upon the judgment of Honble Karnataka High Court in the case of Toyota Kirloskar Auto Parts Pvt. Ltd. vs. CCE, LTU, Bangalore reported in 2012 TIOL 10 HC KAR CX, which has been relied upon by the Tribunal in its recent judgment in the case of CCE, Jaipur II vs. BSL Ltd. reported in 2014 TIOL 1410 CESTAT DEL and that in view of this, there is no infirmity in the impugned order. He, however, accepted that the Assistant Commissioners order dated 29/3/05 by which the Assistant Commissioner has confirmed the duty demand totalling Rs. 11,58,767/- does mention that the respondent in pursuance of the Commissioner (Appeals)s order dated 24/07/98 had filed a refund claim of Rs. 1,23,82,872/- which included the amount of Rs. 86,54,690/- in respect of clearances certain depots and that refund claim had been rejected by the Assistant Commissioner on 05/1/2000 and appeal against that order of the Assistant Commissioner had been rejected by the Commissioner (Appeals) vide order-in-appeal dated 28/11/03.
6. We have considered the submissions from both the sides and perused the records.
7. The Commissioner (Appeals) vide order-in-appeal dated 24/7/98 had decided that
(a) in respect of clearances of the appellant from their factory to various depots, the price of each depot should form the basis for arriving at the assessable value in respect of clearances to that particular depot ;
(b) the respondent would be eligible for deduction of turnover tax and discount in respect of supplies to hospitals and nursing home ;
(c) the respondent would not be eligible for deduction of the depot expenses and
(d) there would be eligible for deduction of cash discount wherever it has been passed on.
8. The Commissioner (Appeals) having decided these issues directed the Assistant Commissioner to re-quantify the duty demand for the period of dispute. The duty demand for the period of dispute is covered by 8 separate show cause notices by which duty amounted to Rs. 1,55,11,932/- has been demanded. In pursuance of the Commissioner (Appeals)s order, the Assistant Commissioner vide order-in-original dated 29/3/05 confirmed the demand of only Rs. 11,58,767/- and the operative portion of the order is totally silent about any refund. However, that order does mention that after the Commissioner (Appeals)s order dated 24/7/98, the respondent had filed a refund claim for an amount of Rs. 1,23,82,872/- and as conceded by Shri B.L. Narasimhan, the learned Counsel for the respondent, this refund claim includes the amount of Rs. 86,54,690/- mentioned in the impugned order of the Commissioner (Appeals). The Assistant Commissioners order also mentions that this refund claim had been rejected by the Deputy Commissioner vide order-in-original dated 05/1/2000 and appeal against this order had been rejected by the Commissioner (Appeals) vide order-in-appeal dated 28/11/03 and against this order of the Commissioner (Appeals), no further appeal had been filed. Thus the issue of refund of Rs. 1,23,82,872/- which includes the amount of Rs. 86,54,690/- became final vide order-in-appeal dated 28/11/03. For this reason only, the Assistant Commissioner in his order dated 29/3/05 has demanded the duty of only Rs. 11,58,767/- and has not ordered the adjustment of the amount of demand against any amount becoming refundable, as the refund claim had already been rejected. In view of this factual background, the impugned order-in-appeal dated 10/11/05 permitting the adjustment of the duty demand of Rs. 11,58,767/- against the excess payment of duty of Rs. 86,54,690/- is totally wrong and as such there was no authority for the same. We, therefore, hold that the impugned order is not correct. The same is set aside and the order-in-original dated 29/3/05 passed by the Assistant Commissioner is restored and as such the Assessees plea for adjustment of the duty demand of Rs. 11,58,767/- against the claimed excess payment of Rs. 86,54,690/- cannot be accepted. The Revenues appeal is, therefore, allowed.
(Pronounced in open court on 12/02/2015.) (Rakesh Kumar) Member (Technical) (S.K. Mohanty) Member (Judicial) PK ??
??
??
??
8