Customs, Excise and Gold Tribunal - Mumbai
Emil Pharmaceutical (India) P. Ltd. vs Cce on 20 April, 1999
Equivalent citations: 1999(85)ECR489(TRI.-MUMBAI)
ORDER V.K. Agrawal, Member (T)
1. M/s. Emil Pharmaceutical (India) Pvt. Ltd. have filed the present appeal, being aggrieved by the order dated 4.5.1994 passed by the Collector of Central Excise, Bombay-II.
2. When the matter was called, none appeared on behalf of the appellants. However, they have, under their letter dated 3.1.1999, requested to decide the issue on merits. It has been submitted by them that they were manufacturing medicaments on their own behalf as well as on loan licence to M/s. Abbott Laboratories India Ltd. & M/s. Merind Ltd. The medicines, bearing the brand name of these two loan licencees, were cleared by them availing the exemption under Notification No. 175/86. When the Central Excise officers visited their factory on 3.10.1992, they pointed out that the appellants are not entitled for concessional 337 rate of duty as they affixed the brand names of the manufacturers, who were not entitled to the benefit of Notification No. 175/86. It has been, further, mentioned by them that they had already paid duty amounting to Rs. 87,575.49 and no further amount is payable by them for the reason that the value of clearance of the products, which are now held to be liable to duty without the benefit of notification, has to be excluded from the total value of clearance and on the basis of such redetermination, the total amount of duty payable for the financial year 1991-92 X would be Rs. 87,780.02 whereas they had already paid duty amounting to Rs. 88,534.91. In their letter dated 3.1.1999, they also mentioned that they had filed classification list and label of the packaging material. The classification list was approved on 21.9.1992 and as such there was no suppression of facts in respect of two medicines, namely, Panfugal and Bolin Bolus. They have placed reliance on the decision of the Supreme Court in the case of Cosmic Dye Chemical v. C.C.E., Bombay . Finally, they have requested for penalty to be set aside as they had not deliberately made any defiance of law.
3. Shri Sumit K. Das, ld. D.R. submitted that the Collector in the adjudication order has clearly given his findings to the effect that the appellants had not affixed the labels on the products along with classification list and accordingly, the appellants had suppressed the fact of affixing the brand name on the medicament. Regarding redetermination of duty amount, ld. D.R. reiterated the findings of the Collector, according to which, the differential duty had been sought to be recovered only and there is no need to redetermine the same.
4. We have considered the submissions of both the sides. It is now settled by various decisions of the Appellate Tribunal that the value of the clearance of specified goods, affixed with the brand name, will not be taken into consideration while computing the aggregate value of clearance. We observe from the impugned order that the adjudicating authority has not met this point in clear terms and simply had observed that the duty has been demanded for the differential amount. We are, therefore, of the view that this factual position has to be ascertained by the adjudicating authority whether the duty requires to be redetermined or not and for this purpose, we remand the matter to the adjudicating authority with the direction to ascertain the duty payable by the appellants after affording the opportunity of hearing to them. As far as the question of extended period of time limit for confirming the demand is concerned, the Collector has observed very specifically in the adjudication order that the classification list was filed without labels. The appellants have submitted a letter and disclosed the packaging material on 2.1.1992 and that too was addressed to Superintendent (Range). There was no reference on the said letter about the classification list at all. Therefore, it cannot be said that by submitting this letter, the appellants have made a disclosure to the approving authority while approving the classification list. In view of these facts, we hold that the extended period for demanding the duty was invokable in the present case. However, taking into consideration all the facts and circumstances of case, we find that only the nominal amount of penalty will be enough to meet the ends of justice. We, therefore, reduce the amount of duty from Rs. 5,000/- to Rs. 1,000/- only. The appeal is disposed of in the above terms.
(Dictated in the Court).