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of <h1>Tribunal Confirms Duty Demand for Pharma Co, Reduces Amount on Appeal</h1> <h3>M/s GOLD STAR PHARMACEUTICALS PVT LTD, M/s Suraj Medical Agencies & OTHS. Versus COMMISSIONER OF CENTRAL EXCISE, CHANDIGARH</h3> M/s GOLD STAR PHARMACEUTICALS PVT LTD, M/s Suraj Medical Agencies & OTHS. Versus COMMISSIONER OF CENTRAL EXCISE, CHANDIGARH - TMI Issues Involved:Prayer to dispense with pre-deposit of duty and penalty confirmed against a pharmaceutical company engaged in manufacturing of Medicaments based on under-valuation and clandestine removal.Analysis:1. Under-valuation of Medicines:- The duty demand against the pharmaceutical company was confirmed primarily due to under-valuation of medicines and findings of clandestine removal.- The appellant argued that they were clearing goods based on assessable value under Section 4 of the Excise Act, unaware that medicaments were chargeable based on MRP under Section 4A from January 2005.- The appellant acknowledged the duty liability based on MRP but contested the duty calculation using MRP of 2006-07 instead of the lower MRP of 2005-06, reducing the demand.2. Clandestine Removal Allegations:- The remaining demand was based on allegations of clandestine removal supported by statements of chemists and discrepancies in sales records of a dealer.- The appellant argued that chemists' statements were insufficient evidence as they were not involved in manufacturing and lacked cross-examination.- The appellant also contended that discrepancies in dealer invoices could be explained by transactions spanning multiple periods, with some invoices neutralizing excess invoices.3. Decision and Order:- The Revenue argued that the excess cash collected by the company and evidence of clandestine activities were established.- Despite financial difficulties and factory closure, the Tribunal directed the appellant to deposit 50% of the duty amount within 8 weeks to hear the appeal.- The remaining duty and penalties were waived, and recovery stayed during the appeal's pendency, emphasizing the need to protect Revenue's interest.4. Conclusion:- The Tribunal found insufficient prima facie evidence to dispense with the pre-deposit condition, requiring the appellant to deposit a partial amount.- The decision balanced the appellant's financial challenges with the Revenue's interest, ensuring a fair hearing while safeguarding the duty and penalty recovery process.
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