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of <h1>High Court clarifies excise duty point, rejects refund claim on freight charges under Central Excise Act.</h1> <h3>M/s. MEGHALAYA SOVA ISPAT ALLOYS LTD. Versus ADDITIONAL COMMISSIONER OF CENTRAL EXCISE, SHILLONG.</h3> M/s. MEGHALAYA SOVA ISPAT ALLOYS LTD. Versus ADDITIONAL COMMISSIONER OF CENTRAL EXCISE, SHILLONG. - 2018 (362) E.L.T. 259 (Cal.) Issues:1. Determination of excise duty valuation at the removal point versus the point of delivery.2. Applicability of exemption provisions under notification no.32/99-C.E.3. Calculation and payment of excise duty on goods including freight and insurance charges.4. Adjudication on overvaluation and mis-declaration leading to recovery of duty, interest, and penalty.5. Entitlement to refund of excise duty under the exemption notification.Analysis:1. The High Court addressed the issue of excise duty valuation, ruling that duty should be levied at the removal point, being the factory exit, and not at the point of delivery, which is the consumers' entry point. The appellant, a manufacturer of Ferro Alloys, was situated in an area where an exemption notification applied, and the dispute centered on the valuation of goods for excise duty purposes.2. The controversy revolved around the applicability of exemption provisions in notification no.32/99-C.E. The Central Excise authority contended that freight and insurance charges should be excluded from the valuation of goods for excise duty calculation. The appellant had paid duty including these charges, leading to a show cause notice for overvaluation and mis-declaration.3. The first adjudicating authority held that duty on freight charges was not required to be paid and should not have been refunded. The appellant's appeal was dismissed by the CESTAT, affirming the duty valuation at the factory gate. The Court found no error in these findings, emphasizing the importance of determining the point at which excise duty should be levied.4. The Court addressed the recovery of duty, interest, and penalty due to overvaluation and mis-declaration. The appellant's attempt to claim a refund under the exemption notification was dismissed, clarifying that only the sum paid as excise duty, as leviable, would be eligible for refund. Any excess duty paid beyond what is leviable could be refunded through the regular channel under the law.5. Consequently, the Court disposed of the appeal, stating that the refund claimed under the notification should be treated as a refund under Section 11B of the Central Excise Act, 1944. The judgment clarified the entitlement to refund and highlighted the distinction between duty leviable and excess duty paid, emphasizing the proper procedure for refund claims.
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