Custom, Excise & Service Tax Tribunal
Commissioner Of Central Excise, ... vs Indian Telephone Industries Ltd on 2 February, 2016
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeal(s) Involved: E/819/2007-DB [Arising out of Order-in-Appeal No. 146/2007 dated 20/08/2007 passed by the Commissioner of Central Excise (Appeals-I), Bangalore.] For approval and signature: HON'BLE SMT. ARCHANA WADHWA, JUDICIAL MEMBER HON'BLE SHRI ASHOK K. ARYA, TECHNICAL MEMBER 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? No 3 Whether Their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes Commissioner of Central Excise, Customs and Service Tax BANGALORE-I POST BOX NO 5400, CR BUILDINGS, BANGALORE 560 001. Appellant(s) Versus INDIAN TELEPHONE INDUSTRIES LTD. DOORVANI NAGAR, BANGALORE Respondent(s)
Appearance:
Mr. N. Jagadish, Superintendent (AR) For the Appellant Shri B. V. Kumar, Advocate No.103, 17th C Main Road, 5th Block, Kormangala, Bangalore 560 095. For the Respondent Date of Hearing: 02/02/2016 Date of Decision: 02/02/2016 CORAM:
HON'BLE SMT. ARCHANA WADHWA, JUDICIAL MEMBER HON'BLE SHRI ASHOK K. ARYA, TECHNICAL MEMBER Final Order No. 20185 / 2016 Per : ARCHANA WADHWA Being aggrieved with the order passed by Commissioner (A), Revenue has filed the present appeal. We have heard Shri N. Jagadish, Superintendent (AR) appearing for the Revenue and Shri B. V. Kumar, Advocate appearing for the Respondent.
2. As per facts on record, the respondent is manufacturer of communication equipments classifiable under Chapter 85 of the Central Excise Tariff Act, 1985. During the period from 1.4.1998 to 31.3.1999, the respondents were selling their goods to the Department of Telecommunication, Government of India against contracts. As per the price variation clause in the contract, the price of the goods was to be finalized only after their clearances. Accordingly, Respondents opted for provisional assessment which was granted by their jurisdictional Assistant Commissioner vide his order dated 28.4.1997.
2.1 The said provisional assessment was subsequently finalized by the Deputy Commissioner in respect of the goods cleared during the period 1998-99 to 2000-2001. As a result of finalization of provisional assessment, there were certain short payments by the respondent and certain excess payments. In terms of the said order of the Deputy Commissioner, jurisdictional range authorities confirmed the differential short-paid duty to the tune of around Rs.1.29 crores. Further in respect of the duty excess paid by the respondent, they were advised to follow the procedure of filing a refund claim.
2.2 On an appeal against the above order, the Commissioner (A) held that the duty excess paid by the assessee is required to be adjusted against the duty short-paid by them. Inasmuch as excess paid duty was more than the duty short-paid, he neutralized the same and advised the assessee to file refund claim for the balance.
3. Being aggrieved with the said order, Revenue has filed the appeal on the following grounds.
* The suo motto refunds taken by the assessee by adjusting the excess duty paid towards the duty short paid for the entire year 1998-99 appears to be not in order inasmuch as the assessee is required to pay the duty short paid and the duty excess paid has to pass through the process of refund under Section 11B of the Central Excise Act, 1944. In case of duty excess paid, it appears that the duty burden has already been passed on the customers and no proof contrary to the same has been placed on record or indicated in the assessees final excise duty statements.
* The suo motto refund taken by the assessee on account of credit notes were not relating to the period in question and without corroborative evidence such as, commercial invoice/bill-cum-delivery challans, is an additional consideration and the same is required to be included in the selling price of the goods and duty payable on this account.
* In view of the above, Commissioner (Appeals) Bangalore has erred in modifying the demand for the period 1998-99 and hence the order suffers from infirmity and therefore the same is not legal and proper.
* In view of the above facts and circumstances of the case, the O-I-A No.146/2007 dated 20.8.2007 passed by Commissioner (Appeals), Bangalore modifying the Order dated 15.12.2006 of the Asst. Commissioner of Central Excise, Bangalore-I Division, and allowing the suo motto adjustment made by the assessee towards duty paid in excess against paid short may be set aside and pass orders as deemed fit.
4. After hearing both the sides, we find that the short issue required to be decided is as to whether the duty excess paid by the assessee during the period of provisional assessment is required to be adjusted towards he duty short-paid by them, upon finalization of such provisional assessment. Learned counsel for the respondent has relied upon various decisions of the Tribunal laying down that such adjustment is required to be done. However, reference can be made to latest decision in the case of Hindustan Zinc Ltd. vs. Commissioner of Central Excise, Jaipur: 2015-TIOL-2427-CESTAT-DEL. wherein there was originally difference of opinion between the two Members of the Bench and the issue was decided by the third Member. It was held that the assesse is entitled for adjustment of excess paid duty with the short-paid duty during the period of provisional assessments, upon finalization of the assessments. Inasmuch as the issue is decided by the majority decision of the Tribunal in favour of the assessee, we find no merits in the Revenues appeal. The same is accordingly rejected.
(Order pronounced in open court) ASHOK K. ARYA TECHNICAL MEMBER ARCHANA WADHWA JUDICIAL MEMBER rv 5