Custom, Excise & Service Tax Tribunal
M/S. Taste Well Product vs Cce &St, New Delhi on 19 January, 2016
IN THE CUSPTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI, PRINCIPAL BENCH NEW DELHI
Date of Hearing/ Decision:19.01.2016
Excise Appeal No.52161 of 2015-EX(SM)
(Arising out of Order-in-Appeal No.08-CE/LKO/2013 dated 27.09.2013 passed by the Commissioner of Central Excise (Appeal-I), New Delhi).
For approval and signature:
Honble Shri B. Ravichandran, Member (Technical)
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Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
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Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
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Whether Their Lordships wish to see the fair copy of the Order?
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Whether Order is to be circulated to the Departmental authorities?
M/s. Taste Well Product ...Appellants
Vs.
CCE &ST, New Delhi Respondent
Appearance:
Rep. by Shri S.R. Agarwal, Advocate for the appellant.
Rep. by Shri G.R. Singh, AR for the respondent.
Coram: Honble Shri B. Ravichandran, Member (Technical) Final Order No.50093/2016 Dated:19.01.2016 Per B. Ravichandran:
The appellants are engaged in the manufacture of chewing tobacco liable to central excise duty. The appellants are discharging their duty liability in terms of Chewing Tobacco and Unmanufactured Tobacco, Packing Machines (Capacity Determination and Collection of Duty) Rules, 2010. On 28.11.2011, they intimated their intention to discontinue commercial production of chewing tobacco w.e.f. 1.12.2011 and on 20.12.2011; again intimated for commencement of commercial production w.e.f. 23.12.2011. They have paid central excise duty of Rs.4,85,484/- on 5.1.2012 for seven days of operation (23.12.2011 to 29.12.2012). Similarly, they have paid duty of Rs.1,48,276/- on 5.3.2012 for manufacturing operation of two days 14.2.2012 and 15.02.2012. The Department proceeded against the appellant for short payment of duty for the month of December, 2011 and Feb. 2012. The duty for the full period was demanded and confirmed by the Original Authority vide Order dated 13.03.2014. On appeal, the Commissioner (Appeals) set aside the order relating to demand but confirmed demand for interest of Rs.63,616/-.The Commissioner (Appeals) found that the appellants availed abatement on their own. Had the appellants followed the proper procedure, the full amount as confirmed in the original order would have been paid and later, abatement would have been granted as per the actual dates of operation. As such, the Commissioner (Appeals) held that the Government was deprived of the interest and hence, the same is payable by the appellant. Aggrieved by this order, the appellants filed this appeal.
2. Ld. Counsel for the appellants submitted that
(a) the Commissioner (Appeals) finding that due date for payment of duty for the month of December, 2011 is 5.12.2011 and for the month of Feb., 2012 is 5.2.2012 is mis-conceived. It is an admitted fact that the number of machines operating and installed on 1.12.2011 and also on 1.2.2012 in the factory of the appellants was nil,
(b) third proviso to Rule 9 read with Rule 6 of the above mentioned Rule would show that there is no operating/installed machines on the due date for payment of central excise duty. Rule-9 only prescribe & the manner of payment of duty and it cannot create duty liability,
(c) in a similar situation, the Tribunal in the case of Trimurti Fragrance Private Ltd. - vide Final Order No.53520 of 2015-SM(BR) dated 24.11.2015 held that when the machines were in-operative during the period in which the due date for payment falls, in such situation, the duty payable will be 5th of next month, in terms of 3rd proviso to Rule 9.
3. Ld. AR reiterated the findings of the Lower Authority in the impugned order.
4. Heard both the sides and perused the appeal records.
5. The point for consideration is that liability of the appellant to pay interest for the duty liability that arose during the month of December, 2011 and Feb. , 2012. The reason given for confirming the interest is that the due date for payment of duty in terms of the above mentioned Rules is 5th of same month. The same is stipulated in Rule 9. The 3rd proviso to Rule 9 gives an exception that in case of increase in the number of operating machines in the factory during the month on account of addition or installation of packing machines, the differential duty amount, if any, shall be paid by the 5th day of the following month. It is an admitted fact that during the period 1.12.2011 to 22.2.2011, there is no operative machine in the appellants factory. Similarly, during the period 1.2.2012 to 13.02.2012, there was no operating machine with the appellant. In other words, during the period in which the due date falls, there is no manufacturing operation by the appellant. Hence, it follows that no duty could be determined and paid by them by 5th of the same month. The machines were un-sealed and allowed for operation much later and such situation will be covered by the 3rd proviso of Rule 9. Reliance is placed on the Tribunals Final Order dated 24.11.2015 in the case of Trimurti Fragrance Pvt. Ltd.(supra). Considering the above discussion and legal position, I find no merit in the impugned order. Accordingly, the same is set aside and the appeal is allowed.
[Operative portion of order pronounced in the court] ( B. Ravichandran ) Member (Technical) Ckp.
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