Custom, Excise & Service Tax Tribunal
M/S.Apna Products vs Cce, Jaipur-Ii on 20 October, 2009
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
WEST BLOCK NO.II, R.K. PURAM, NEW DELHI-110066.
BENCH-DB
COURT - I
Excise Appeal No. E/688/05
[Arising out of Order-in Appeal No.695(RM) CE/JPR-II/2004 dated 23.11.2004 passed by the Commissioner (Appeals)_II, Jaipur].
Date of Hearing:20.10.2009
Date of decision:20.10.2009
For approval and signature:
Honble Mr. Justice R.M.S. Khandeparkar, President
Honble Mr.Rakesh Kumar, Member (Technical)
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 Their Lordships wish to see the fair copy of the Order?
4 Whether Order is to be circulated to the Departmental authorities?
M/s.Apna Products Appellant
Vs.
CCE, Jaipur-II Respondent
Present for the Appellant : Shri Atul Gupta, C.S.
Present for the Respondent : Shri R.K.Verma, DR
Coram: Honble Mr.Justice R.M.S. Khandeparkar, President
Honble Mr. Rakesh Kumar, Member (Technical)
ORAL ORDER NO. _______________ DATED:20.10.2009
PER: JUSTICE R.M.S.KHANDEPARKAR Heard Shri Atul Gupta, CS for the appellants & Shri. R.K.Verma, ld. DR for the respondent.
2. Appellants challenge the order dated 23.11.2004 passed by the Commissioner (Appeal), Jaipur whereby the appeal filed by the appellant against the order passed by the original authority was rejected. The original authority, namely, Dy. Commissioner, Chittorgarh by its order dated 30th July 2004 had confirmed the demand of differential duty of Rs.18,077/- for the period 1st August, 2003 to 15th September, 2003 and had imposed penalty of Rs.2,000/- besides demanding the interest.
3. The appellants are the manufacturer of Chewing Tobacco classifiable under Chapter Heading 2404.41. The appellants were packing Chewing Tobacco in multi-piece packages containing of 50 pouches of 3 grams each and 35 pouches of 6 grams each. The show cause notice came to be issued on 10th October, 2003 proposing to duty demand of Rs.13,078/- being the difference in the value under section 4 and MRP under section 4A of the Central Excise Act 1944 alongwith interest thereon besides the penalty. The show cause notice was contested by the appellants and consequently, the order dated 30th July, 2004 came to be passed by the Dy. Commissioner.
4. As rightly pointed out by the ld. Advocate for the appellants similar issue arose in similar set of facts in the matter of Miraj Products Pvt. Ltd. vs. CCE, Jaipur reported in 2009 (91) RLT 25 (CESTAT-Del.) and the Tribunal relying upon the decision of the Supreme Court in the case of CCE VS. Kraftech Produts Inc., reported in 2008 (85) RLT 701 (SC) held that the product was required to be assessed under section 4 and under section 4A. Before arriving at a said finding the Tribunal observed thus:
5. We find that in the impugned order the adjudicating authority relied upon the decision of the Madras High Court in the case of Varnica Herbs (supra). The Larger Bench of the Tribunal in the case of CCE vs. Urison Cosmetics Ltd. [reported in 2006 (75) RLT 105 (CESTAT-LB)] held that the pouches less than 10 gms. Which are sold in multi-pack are assessable under section 4 of the Central Excise Act. The Larger Bench also hold that the decision of Honble High Court has been rendered per incuriam, without noticing the specific legal requirement to sell cosmetics by weight or volume, can not be followed as a binding precedent. This view was upheld by the Honble Supreme Court in the case of CCE vs. Kraftech Products Inc., reported in 2008 (85) RLT 701 (SC) =2008 (224) ELT 504 (SC). The Honble Supreme Court held that the reasoning adopted by the Honble Madras High Court in Varnica Herbs does not appeals to them. The Honble Supreme Court further agreed with the view taken by the Larger Bench of the Tribunal in the case of Urison Cosmetics Ltd. (supra). The Honble Supreme Court has held as under:-
23. We have noticed hereinbefore that each package offered to sell to the customer contains three sachets. Net weight of all the three sachets are stated thereon. It is a multi-piece package, which is capable of being offered to sell as such only because a package is a multi-piece package, the same cannot be taken out of the umbrage of exemption clause contained in Rule 34 of the Rules. Why the commodity cannot independently be sold either by weight or measure is beyond our comprehension particularly when Rule 12 (2) permits the same. The illustration appended to Rule 2(j) bring out a clear picture. It states that the combined net weight shall be taken into consideration for the purposes mentioned therein. After combined weight is taken into consideration for the purpose of applicability of the Rules, there is no reason as to why the said purpose shall not be considered to be a relevant factor for applying the exemption provision. Assuming Rule 2(j) was otherwise vaguer or unambiguous, illustration appended thereto brings out the true meaning and purport thereof. The reasoning adopted by the Madras High Court in Varnica Herbs (supra) does not appeal to us.
24. It was rendered per incuriam. It was held to be so in Urison Cosmetics Ltd. (supra) by a Larger Bench of the Customs Excise and Service Tax Appellate Tribunal. We agree with the said opinion of the Tribunal. In view of the above decision of the Honble Supreme Court the impugned orders are set aside and appeals are allowed.
5. The ld. DR fairly conceded that the issue is covered by the said decision of the Tribunal read with the said decision of the Apex Court. In the facts and circumstances of the case, the issue being fully covered by the said decision read with decision of the Apex Court in the matter of Miraj Products Pvt. Ltd. case, the appeal succeeds and is hereby allowed and impugned order is set aside with consequential relief.
(JUSTICE R.M.S.KHANDEPARKAR) PRESIDENT (RAKESH KUMAR) MEMBER (TECHNICAL) Anita