Custom, Excise & Service Tax Tribunal
M/S. Ganga Kisan Sahkari Chini Mills Ltd vs Cce, Meerut-I on 30 July, 2010
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Block No. 2, R.K. Puram, NEW DELHI COURT No. II CENTRAL EXCISE APPEAL NO. 1274 OF 2008-SM [Arising out of Order-in-Appeal No. 92/Ce/APPL/MRT-I/2008 dated 25.04.2008 passed by the Commissioner (Appeals), Central Excise, Meerut-I, Meerut] M/s. Ganga Kisan Sahkari Chini Mills Ltd., Appellant None Versus CCE, Meerut-I Respondent
Reptd. by Shri R.K. Gupta, SDR Date of Hearing/decision: 30th July, 2010 Coram: Honble Shri D.N. Panda, Judicial Member STAY ORDER NO. DATED Per D.N. Panda:
None is present for the appellant nor there is any application for adjournment.
2. The appeal is against the refund claim of Rs. 6,05,698/-. The appellant relying upon Circular No. 709/25/2003-CX dated 23rd April, 2003 pleaded before the department that no overtime charges shall be payable for the supervision outside the factory but the money paid on such account shall be refundable. Learned adjudicating authority examined the claim of the appellant and viewed that circular was issued on 23.04.2003 while the overtime charges were paid by the appellants for the financial year 2002-03 when circular No. 610/1/2002-CX., dated 1.1.2002 was in force. Hence, the appellant was required to pay overtime charges.
3. According to the department circular dated 23.4.2003 being prospective in nature the appellants refund is deniable. Learned D.R. supports the order of the adjudicating authority relying upon the decision of the Tribunal in the case of CCE, Rajkot vs. Reliance Industries Ltd., reported in 2009 (236) ELT 328 (Tri.-Ahmd.) and prays that matter may be referred to Larger Bench and the appellant should not succeed here.
4. Heard learned D.R. and also gone through the record including the circular as well as decision cited by learned D.R.
5. There is no dispute that there was circular of 1.1.2002 governing the matter for sometime. According to that circular storage of sugar was permissible outside the factory. Department was of the view that since storage is permitted outside the factory there shall be physical supervision of departmental officer on such goods for which cost of supervision popularly known as overtime charges shall be collectable from the assessee. The same circular was reviewed by Board and Board clearly brought out in para 2 of circular dated 23.4.2003 that earlier Boards circular does not envisage any physical supervision of such storage premises/ godown by the Central Excise outside the factory. It was also viewed by the Board that in current era of liberalization and simplication of law and procedures the overtime charges are no longer warranted. While expressing such view, this circular imposed an obligation upon the Commissioner to prescribe any other condition that he deems fit for the safeguard of the revenue in the cases where permission is granted for storage of non-dutiable goods outside factory. The vision of the government and the policy issued is very clear that there was no physical supervision warranted on non-duty paid goods to be compensated by overtime charges. Therefore, the policy decision should not bring the appellant to fasten liability.
6. The decision relied upon by the learned D.R. in the case of Reliance Industries Ltd. (supra) is in respect of customs issue on physical supervision required in the case of stocking of goods inside containers. No doubt appeal was before the Tribunal in excise matter. The intention of legislature in terms of Section 11 Customs Act, 1962 is as under which deals with the power of prohibition for importation and exportation of goods:-
SECTION 11.?Power to prohibit importation or exportation of goods. (1) If the Central Government is satisfied that it is necessary so to do for any of the purposes specified in sub-section (2), it may, by notification in the Official Gazette, prohibit either absolutely or subject to such conditions (to be fulfilled before or after clearance) as may be specified in the notification, the import or export of goods of any specified description.
(2)?The purposes referred to in sub-section (1) are the following :-
( a) the maintenance of the security of India;
(b) the maintenance of public order and standards of decency or morality;
(c) the prevention of smuggling;
(d) the prevention of shortage of goods of any description;
(e) the conservation of foreign exchange and the safeguarding of balance of payments;
(f) the prevention of injury to the economy of the country by the uncontrolled import or export of gold or silver;
(g) the prevention of surplus of any agricultural product or the product of fisheries;
(h) the maintenance of standards for the classification, grading or marketing of goods in international trade;
(i) the establishment of any industry;
(j) the prevention of serious injury to domestic production of goods of any description;
(k) the protection of human, animal or plant life or health;
(l) the protection of national treasures of artistic, historic or archaeological value;
(m) the conservation of exhaustible natural resources;
(n) the protection of patents, trade marks and copyrights;
(o) the prevention of deceptive practices;
(p) the carrying on of foreign trade in any goods by the State, or by a Corporation owned or controlled by the State to the exclusion, complete or partial, of citizens of India;
(q) the fulfilment of obligations under the Charter of the United Nations for the maintenance of international peace and security;
(r) the implementation of any treaty, agreement or convention with any country;
(s) the compliance of imported goods with any laws which are applicable to similar goods produced or manufactured in India;
(t) the prevention of dissemination of documents containing any matter which is likely to prejudicially affect friendly relations with any foreign State or is derogatory to national prestige;
(u) the prevention of the contravention of any law for the time being in force; and
(v) any other purpose conducive to the interests of the general public.
7. When the object of Section 11 of the Customs Act, 1962 is looked into, the reliance placed by the Revenue may be of no help to them. But in the present context the decision is mis-placed in view of the policy of the government for no collection of undesirable charges.
8. For the reason aforesaid, it is not required to halt at this stage to keep this appeal pending till the Larger Bench decision comes up. Accordingly appeal filed by the appellant is allowed and refund that shall flow is permissible subject to scrutiny under the law.
(Dictated & pronounced in the Open Court.) (D.N. PANDA) JUDICIAL MEMBER RK 5