Custom, Excise & Service Tax Tribunal
Commissioner Of Central Excise ... vs M/S. Textile Cropn. Of Marathwada Ltd on 2 August, 2011
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI APPEAL NO. E/725/2004-Mum. in E/CO/77/2005-Mum. (Arising out of Order-in-Appeal No. BPS(359)/257/2003 dated 10.11.2003 passed by the Commissioner of Central Excise & Customs (Appeals), Aurangabad. For approval and signature: Honble Shri Ashok Jindal, Member (Judicial) Honble Shri Sahab Singh, Member (Technical) ============================================================
1. Whether Press Reporters may be allowed to see : No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should 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 : Yes
of the Order?
4. Whether Order is to be circulated to the Departmental : Yes
authorities?
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Commissioner of Central Excise Aurangabad.
:
Appellants
VS
M/s. Textile Cropn. Of Marathwada Ltd.
Respondents
Appearance
Shri V. K. Agarwal SDR Authorized Representative
Shri Gajendra Jain, Advocate for Respondent
CORAM:
Shri Ashok Jindal, Member (Judicial)
Shri Sahab Singh, Member (Technical)
Date of hearing : 02/08/2011
Date of decision : 02/08/2011
ORDER NO.
Per : Ashok Jindal
Revenue is in appeal against the impugned order wherein the Commissioner (Appeals) set aside the adjudication order for demanding additional duty along with interest and levying penalty on the respondent.
2. The brief facts of the case are that the respondents were engaged in the manufacture of processed woven fabrics of Cotton, man made filament, man made staple fibre and terry fabrics on job work basis. The respondents are clearing the goods following the procedure laid down by the apex court in the case of Ujagar Prints Vs. Union of India i.e. cost of raw material + job charges Abundant quation, the appellant also add in their assessable value Rs.0.75 per meter as traders profit although it was not includible in the assessable value. The allegation of the department, as per show-cause notice, is that they have not included the Octroi duty transportation charges, loading/unloading charges of fabrics and marketing expenses and interest. The respondent has also not included the trader profit at the rate of .94 per meter in their assessable value. Therefore, the respondent have undervalued their fabrics. The said show-cause notice was adjudicated. In adjudication, the adjudicating authority dropped the demand for octroi duty but confirmed the differential duty on account of transportation, loading/unloading, manufacturing expenses and traders profit Rs. 0.19 per meter along with interest and equivalent amount of penalty. The said adjudication order was challenged for addition in the assessable value, which was considered by the Commissioner (Appeals) and the same was set aside holding that the manufacturer profit is not includible in the assessable value, as per CBEC Circular No. 619/`10/2002-CX. dated 19.2.2002. Against the said order Revenue is in appeal.
3. Shri V.K. Agarwal the learned SDR reiterated the grounds of appeal and submitted that the value of transportation, manufacturing expenses and traders profit are includible in the assessable value, therefore the impugned order is to be set aside.
4. Shri Gajendra Jain the learned Advocate for the respondent submitted that the traders profit is not includible in the assessable value as per CBEC Circular No. 619/`10/2002-CX. dated 19.2.2002. If at all transportation, loading/unloading charges and manufacturing expenses are to be taken into account for consideration of the assessable value, then also they have already discharged duty liability by adding Rs.0.75 per meter in their assessable value. He further submitted that the activity taken by the respondent is scoring of the fabrics, which is exempt from duty, therefore the demands are not sustainable. He further submitted that the show-cause notice is also barred by limitation as same has been issued by invoking the extended period of limitation, as in the facts and circumstances of the case, the extended period is not invokable in this case.
5. Heard both sides.
6. On careful consideration of the submissions made by the rival side, we find that as per CBEC Circular No. 619/`10/2002-CX. dated 19.2.2002, the traders profit is not includible in the assessable value. The departmental officers are bound by board circular. Therefore, the demand of Rs. 0.94 for addition of traders profit is not sustainable. If at all the demand of transportation, loading/unloading charges and manufacturing expenses are to be taken into account to arrive assessable value, the respondent has already included Rs.0.75 per meter in the assessable value after adopting the formula as laid down by the Apex Court in the case of Ujagar Prints that is cost of raw material + job charges. Therefore, the charges made in the show-cause notice are not sustainable although the Commissioner (Appeals) has not dealt the issue on limitation and we also find that as the respondents are succeeding on merits, therefore, we are not dealing in limitation issue.
7. With these observations, we do not find any merit in Revenues appeal. Therefore we uphold the impugned order and dismissing the Revenues appeal.
8. Cross objection are also disposed of in the above manner.
(Dictated in court) (Sahab Singh) Member (Technical) (Ashok Jindal) Member (Judicial) Sm 4