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of <h1>Excise duty on wrapping paper: Pay once, not twice. Precedent set by Tribunal aligns with High Court.</h1> <h3>SHREE RAYALASEEMA PAPER MILLS LTD., KURNOOL Versus COLLECTOR OF CENTRAL EXCISE, HYDERABAD</h3> The Tribunal allowed the appeal by a paper mill, ruling that excise duty on wrapping paper should be paid only once, aligning with the Andhra Pradesh High ... - Issues:- Whether excise duty should be paid on wrapping paper at two stages.- Whether charging duty twice on the same goods is legal.- Interpretation of rules regarding excise duty on wrapping paper.- Application of recent explanation added to Central Excise Rules.- Whether wrapping paper loses its identity when used for packing other paper.- Comparison with relevant court decisions.- Compliance with Andhra Pradesh High Court ruling.Analysis:The judgment involves an appeal by a paper mill against an order requiring them to pay excise duty on wrapping paper at two stages. The Assistant Collector mandated duty payment on wrapping paper when manufactured and again when used for packing other paper. The Appellate Collector upheld this decision, leading to the current appeal. The appellants argued against double duty payment, citing a similar High Court judgment. The respondents relied on retrospective rule amendments and court decisions to justify the duty imposition at both stages. The Tribunal analyzed the arguments and relevant court decisions, including the integral role of packing in manufacturing. However, the Tribunal found that the wrapping paper retained its identity even when used for packing other paper, as evidenced by separate assessments and duty rates.The Tribunal referenced the Andhra Pradesh High Court's ruling in a similar case, directing that duty should be charged only once on wrapping paper. The Tribunal aligned with this decision, allowing the appellants to follow the procedure established by the Andhra Pradesh Paper Mills Ltd. The judgment emphasized adherence to the High Court's directive, ensuring excise duty payment only once on the wrapping paper. Consequently, the appeal was allowed in favor of the appellants, aligning with the Andhra Pradesh High Court's decision and setting a precedent for duty assessment on wrapping paper.
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