Custom, Excise & Service Tax Tribunal
M/S. Anitha Devi Spinning Mills (P) Ltd vs Cce, Coimbatore on 11 April, 2008
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No. E/187/2006
(Arising out of Order-in-Appeal No. 286/2005-CE dated 13.12.2005 passed by the Commissioner of Central Excise (Appeals), Coimbatore)
For approval and signature:
Honble Mr. P. G. Chacko, 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 should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether the Member wishes to see the fair copy of the Order?
4. Whether Order is to be circulated to the Departmental authorities?
M/s. Anitha Devi Spinning Mills (P) Ltd. Appellants
Vs.
CCE, Coimbatore Respondent
Appearance Shri S. Jaikumar, Advocate for the Appellants Smt. R. Bhagya Devi, SDR for the Respondent CORAM Honble Mr. P. G. Chacko, Member (J) Date of Hearing: 11.04.2008 Date of Decision: 11.04.2008 Final Order No. ____________ The appellants had, during 2002 03 sold their product [cotton yarn on cones] through consignment agents viz. M/s. Apsara Textile Mills, [consignment agent]. At the time of clearance of the goods from factory, duty was paid at the rate of 16% (BED) and also AED thereon. The consignment agents collected duty from buyers on the same goods at the rate of 18% (BED) and AED thereon and the amount so collected was transmitted to the appellants. The department, on verification of the sales invoices of the consignment agent, noticed that whatever amount was collected by them from their buyers in the above manner was collected as duty of excise and that this amount was passed on to the appellants. On these facts, the department raised a demand on the appellants under Section 11D of the Central Excise Act. Accordingly, the appellants were to pay an amount of Rs.23,661/- [the excess duty collected by the consignment agents and passed on to the appellants] to the exchequer. This demand was contested by the party, but in vain. The present appeal is against the appellate Commissioners order sustaining the original authoritys decision confirming the demand against the appellants under Section 11D.
2. Learned counsel has made an endeavour to show that Section 11D might not be applicable to this case inasmuch as the appellants had not collected any excess duty directly from the buyers of the consignment agents. Learned SDR has rebutted this plea by referring to the text of Section 11D. Section 11D(1) reads as under:-
Section 11D. Duties of excise collected from the buyer to be deposited with the Central Government. (1) Notwithstanding anything to the contrary contained in any order or direction of the Appellate Tribunal or any Court or in any other provision of this Act or the rules made thereunder, in any manner as representing duty of excise, shall forthwith pay the amount so collected to the credit of the Central Government. It is clear from the above provision that any amount collected by any person (who is liable to pay duty under the Act or the rules made thereunder) in excess of the duty assessed/ determined/paid on any excisable goods under the Act or rules made thereunder from the buyer of such goods in any manner as representing duty of excise is liable to pay such amount to the credit of the Government. Such person may collect such amount directly from the buyer of such goods or through intermediaries like consignment agents. Such situations, in my considered view, are covered by expression in any manner used in the text of the provision. In other words, it is not necessary that a person who collected any excess amount of duty unauthorizedly from the buyer of the excisable goods directly. The above provision is to prevent unjust enrichment of a person liable to pay duty, who might collect excess amount representing it to be duty of excise in respect of the goods cleared for home consumption, from his buyers. In the present case, the appellants collected whatever amount was collected by the consignment agent from the buyers of the goods in excess of the duty determined/assessed/paid by the former at the factory-gate. The excess amount so collected by the appellants indirectly gets squarely covered by the aforesaid provision.
3. Learned counsel has made yet another endeavour to show that, in relation to the differential duty collected by the consignment agent and passed on to the appellants, the appellants are entitled to abatement of duty element under Section 4(4)(d)(ii) of the Act. The attempt is obvious to minimize the quantum of duty to be credited to the Government under Section 11D. This plea must be rejected at the outset inasmuch as anything contained in Section 4(4)(d)(ii) is irrelevant to a demand under Section 11D. Even otherwise the plea is far-fetched.
4. The appellants do not have any case on merits. The impugned order is sustained and this appeal is dismissed.
(Dictated and pronounced in open court)
(P.G. CHACKO) Member (J)
Rex
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