TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Sugar syrup excise duty liability requires marketability proof before imposing duty on captive consumption in biscuit manufacturing</h1> <h3>Pomsy Food products (P) Ltd. Versus Commissioner of Central Excise, Customs and Service Tax (Appeals- III) Cochin</h3> Pomsy Food products (P) Ltd. Versus Commissioner of Central Excise, Customs and Service Tax (Appeals- III) Cochin - TMI Issues Involved:1. Levy of duty on sugar syrup captively consumed in the manufacture of exempted final product (biscuits).2. Applicability of extended period of limitation for the demand of duty.Summary:Issue 1: Levy of Duty on Sugar Syrup Captively ConsumedThe appellants, engaged in manufacturing biscuits, availed the benefit of Notification No.3/2006-CE. During the manufacturing process, sugar syrup, classified under heading No.1702.90.90 of CETA, 1985, emerged as an intermediate product. The Revenue contended that the sugar syrup, captively consumed in the manufacture of exempted biscuits, is not eligible for the benefit of Notification No.67/95-CX, thus, excise duty is leviable. The appellants argued that the sugar syrup has no shelf life and is not marketable, and the burden of proving marketability lies with the Revenue. They cited various judgments including Ambaji Foods (India) Pvt. Ltd. Vs. CCE, Chandigarh, and Homemade Bakers (India) Ltd. Vs. CCE, Rohtak, which emphasize that marketability must be established by the Revenue. The Tribunal noted that the adjudicating authority failed to analyze the marketability of the sugar syrup, including its shelf life, as clarified in Board's Circular No.226/60/96-CX. The matter was remanded to the adjudicating authority to examine the marketability and duty liability accordingly.Issue 2: Extended Period of LimitationThe show-cause notice dated 26.05.2012, demanding duty for the period May 2007 to September 2011, invoked the extended period of limitation. The appellants argued that due to fluctuating views within the departmental circles on the issue of marketability, the extended period of limitation is unsustainable. They cited the Tribunal's decision in Pepsico India Holdings Vs. CCE, which held that such demands are unsustainable due to fluctuating departmental views. The Tribunal agreed with the appellants, noting that the imposition of penalty under Section 11AC of the Central Excise Act and Rule 25 of the Central Excise Rules is also unsustainable due to the interpretative nature of the issue.Miscellaneous ApplicationsThe appellants filed applications to amend the grounds of appeal, citing Notification No.39/2011-CE dated 12.09.2011, which exempts sugar syrup captively consumed in biscuit manufacturing from 12.09.2011. The Tribunal allowed the amendment, noting that the issue affects the liability for the period post-12.09.2011, and remanded the matter to the adjudicating authority for examination.ConclusionThe Tribunal remanded the matter to the adjudicating authority to examine the marketability of the sugar syrup and the applicability of the amending Notification No.39/2011-CE dated 12.09.2011. The appeals were allowed by way of remand. Order Pronounced in Open Court on 19.03.2024.
TaxTMI 
TaxTMI 
