Custom, Excise & Service Tax Tribunal
M/S U.P. Organics Ltd vs Commissioner Of Central Excise, ... on 7 June, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL,
REGIONAL BENCH : ALLAHABAD
Appeal No.E/3294/2006-EX[DB]
Arising out of Order-in-Appeal No.197-CE/MRT-I/2005 dated 28.11.2005 passed by Commissioner (Appeals) Customs & Central Excise, Meerut.
For approval and signature:
HONBLE MR. ANIL CHOUDHARY, MEMBER (JUDICIAL)
HONBLE MR. ANIL G. SHAKKARWAR, MEMBER (TECHNICAL)
1. Whether Press Reporters 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 the
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not? : Yes
3. Whether His Lordship wishes to see the fair copy
of the Order? : Seen
4. Whether Order is to be circulated to the Departmental
Authorities? : Yes
M/s U.P. Organics Ltd.
APPELLANT(S)
VERSUS
Commissioner of Central Excise, Meerut-I
RESPONDENT (S)
APPEARANCE:
Shri Aalok Arora, Advocates for the Appellant (s) Shri V.R. Reddy Asstt. Commissioner (A.R.) for the Department CORAM:
HONBLE MR. ANIL CHOUDHARY, MEMBER (JUDICIAL) HONBLE MR. ANIL G. SHAKKARWAR, MEMBER (TECHNICAL) DATE OF HEARING & PRONOUNCEMENT : 07.06.2016 FINAL ORDER NO.-70878/2016___ _ Per Mr. Anil G. Shakkarwar:
The present appeal is preferred against Order-in-Appeal No.197-CE/MRT-I/2005 dated 28.11.2005 passed by Commissioner (Appeals) Customs & Central Excise, Meerut.
2. The brief facts of the case are that the appellants are manufacturer of Inverted Syrup and edible preparations not elsewhere specified falling under chapter heading 21.08 of Schedule to Central Excise Tariff Act, 1985. On 27.10.2001, Central Excise Officers visited factory of the appellant. The Officers found shortage of finished goods of 220kg involving duty of Rs.528/-. There was also shortage of 955-kg of edible preparations not elsewhere specified involving duty of Rs.4890/-. The officers also found shortage of input i.e. liquid Glucose 52700-kg, involving Rs.1,18,891/-. It was further notice that appellants charged Rs.0.30/- per kgs from M/s Britania India Ltd. as packing charges on which duty was not paid which worked out to Rs.3,187/-. The duty of Rs.528/-, 4890/-, 1,18,891/- & 3,187 were debited on 27.10.2001. They were issued with a show cause notice, bearing No. Prev/U.P. Organics/67/2001/193 dated 27.03.2003, wherein the appellants were called upon to show cause as to why Central Excise duty realized Rs.528/-, 4890/-, 1,18,891/- should not be appropriated. Further, they were called upon show cause as to why Central Excise duty of Rs.76,144/- on the amount of Rs.4,75,899/- realized from various companies as handling, forwarding & packing charges during the period from 1998-99 to 2001-02 on which no Central Excise duty was paid should not be demanded. Further there was proposal to appropriate Rs.3,187 as Central Excise duty already paid. There were proposals to impose penalty and in respect of interest also. The said show cause notice was adjudicated through Order-in-Original No.47/AC/MZN-II/04 dated 21.09.2004. The original authority confirmed and appropriated Rs.528/-, 1,18,891, 4,890/- & Rs.3,187/-. Further, the original Authority has held that the appellant had realized handling, forwarding and packing charges from various companies and the said amount was not included in the assessable value and those packing were not in the nature of special packing but were general packing. Therefore, on the amount of Rs.4,75,899/- recovered for the period from 1998-99 to 2001-02 realized on account of such packing, Central Excise duty of Rs.76,144/- was confirmed by the original authority and original authority imposed penalty of Rs.1,98,750/- on the appellant under Rules 173 Q of Central Excise Rules, 1944 and Rule 25 of Central Excise Rules, 2001.
3. Aggrieved by the said Order-in-Original dated 21.09.2000, the appellant preferred an appeal before Ld. Commissioner (Appeals). Appellant argued before the first appellate authority that the demand has been raised on account of durable and returnable packing and the demand of duty of such is un-sustainable and further they contended that during the relevant period, appellant being SSI unit, SSI benefit was not extended by the Original Authority. The first appellate authority, therefore, held that the original authority should consider the claim of the appellant in respect of benefit of SSI exemption and remanded the matter to original authority for redetermination of duty in view of SSI exemption through Order-in-Appeal No.197-CE/MRT-I/2005 dated 28.11.2005.
4. Aggrieved by the Order-in-Appeal dated 28.11.2005, the appellant is before this Tribunal. The appellant has contested the issue of durable and returnable packing and also that of imposition of penalty. The grounds of appeal are that the charges on which duty was not paid were the charges for durable and returnable packing such as drums and canes and assessable value was not admissible to include the same as per the Law existed during the relevant period.
5. Heard learned counsel. He has contested that the law allowed deduction on account of durable and returnable packing upon to 30th June, 2000, and further contended that the shortages were found in the factory and there were no allegations of clandestine removal, therefore, the penalty was not justified.
6. The Ld. DR for Revenue has supported the impugned Order-in- Appeal.
7. We have taken into consideration the rival contentions. Prior to 01.07.2000, the amount recovered on durable and returnable packing was deductable from value. Therefore, we modify the Order-in-Appeal dated 28.11.2005 to the extent that on reconsideration, original Authority shall not impose any penalty and Original authority shall allow the deduction of amount recovered by the appellant towards durable and returnable packing for the period upto 01.07.2000 and as directed by first appellate authority also examine the issue of extending the benefits of SSI exemption and re-determine the duty payable by the appellant. In above terms, the appeal is allowed.
(Operative part of the order pronounced in the open Court)
SD/ SD/
(ANIL CHOUDHARY) (ANIL G. SHAKKARWAR)
MEMBER (JUDICIAL) MEMBER (TECHNICAL)
Mishra
4
Appeal No.E-3294/06