Custom, Excise & Service Tax Tribunal
Synergies Dooray Automotive Ltd vs Cce,C&St, Visakhapatnam-I on 22 January, 2018
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL REGIONAL BENCH AT HYDERABAD Division Bench Court I Appeals No. E/770/2008 (Arising out of Order-in-Original No. 02/2008-09 (RS), dated 12.06.2008 passed by CCE&C (Appeals), Visakhapatnam) Synergies Dooray Automotive Ltd. ..Appellant(s) Vs. CCE,C&ST, Visakhapatnam-I ..Respondent(s)
Appearance Shri B. Srinivas, Advocate for the Appellant. Shri A.V. Narasimham, Superintendent for the Respondent. Coram:
Honble Mr. M.V. RAVINDRAN, MEMBER (JUDICIAL) Honble Mr. MADHU MOHAN DAMODHAR, MEMBER(TECHNICAL) Date of Hearing: 22.01.2018 Date of Decision: 22.01.2018 FINAL ORDER No.A/30019/2018 [Order per: M.V. Ravindran]
1. This appeal is directed against Order-in-Original No. 02/2008-09 (RS), dated 12.06.2008.
2. Heard both sides and perused the records.
3. On perusal of records, it transpires that the issue is regarding valuation of products manufactured out of the moulds supplied by the manufacturer. In the first round of litigation, the Tribunal vide Final Order No. 578/07, dated 14.05.2007 remanded the matter back to the adjudicating authority to reconsider the issue afresh after amortising the value of the moulds received from the buyer. Consequent to this remand, the adjudicating authority in the impugned order has confirmed the demands raised alongwith interest and imposed penalties. Appellant is before the Tribunal only against penalties.
4. We find that in the remand proceedings, penalties are imposed under rule 25 of Cenvat Credit Rules, 2002, seems to incorrect, inasmuch the issue of amortising value of the moulds supplied by the buyer had to be decided by the Larger Bench of the Tribunal in the case of Mutual Industgries. Since the issue had to be settled by the Larger Bench, we find that the appellant could have entertained a bonafide belief that the value moulds need not be included in the final products. In our view, the bonafide belief of the appellant cannot be doubted in this case. Accordingly, penalty imposed by adjudicating authority under rule 25 of Cenvat Credit Rules 2002 is set aside.
5. On a specific query from the Bench as to whether the appellant discharged the interest liability or otherwise, Ld. Counsel submitted that appellant had discharged the duty liability but he is not aware as to discharge of interest liability. In our considered view, appellant is required to discharge the interest due on the duty liability which has been confirmed against him. To this extent, we uphold the impugned order and the penalty imposed is set aside.
6. Appeal stands disposed of as stated herein above.
(Order dictated & pronounced in open court) (MADHU MOHAN DAMODHAR) (M.V. RAVINDRAN) MEMBER (TECHNICAL) MEMBER (JUDICIAL) vrg (1) Appeal No. E/770/2008