TaxTMI 
TaxTMI 
TaxTMI 
2011 (10) TMI 235
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.....2001 to 18.08.2004, they had cleared tyres to Original Equipment Manufacturers (OEM in short) at concessional rate of duty under Notification No. 03/2001-CE dated 01.03.2001. Some of the goods so cleared were rejected by the consignee and such goods rejected were cleared by the appellant from the premises of OEM on payment of appropriate duty. A show-cause notice dated 10.03.2006 was issued to the appellant demanding interest under Section 11AB of Central Excise Act, 1944 read with Rule 8 of Central Excise Rules, 2002 and also proposing imposition of penalty under Rule 27 of the said Rule. The case was adjudicated by the jurisdictional Asst. Commissioner who dropped the proceedings. The department preferred an appeal before the Commi....
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....T 385 has held that 'the differential duty was paid only later, when the assessee issued supplementary invoices to its customers demanding the balance amount. Seen thus, it was clearly a case of short payment of duty though indeed unintended and without any element of deceit etc. The payment of differential duty thus clearly come under sub-section (2B) of Section 11A and attracted levy of interest under Section 11AB of the Act.' In the case in hand, also, the short payment of duty was unintended, and, paid by the appellant, and hence interest liability would arise automatically." 2.1 The appellant is before me against the impugned order. 3. The learned Counsel for the appellant submits that in this case it is not disputed that....
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.... had brought back the goods to their factory, then the goods should have been added in non-duty paid stock and they could have cleared the goods subsequently on payment of appropriate duty. In such an event, no interest liability would have accrued. Merely because they did not bring back the goods but chose to sell the same from the premises of the OEM itself they cannot be saddled with interest liability. Rule 6 of the said Rules provides for payment of differential duty along with interest only by the recipient of the goods and not by the supplier of the goods. There is no provision under the said Rule for payment of interest by the supplier of goods and, therefore, the question of demand of interest liability does not arise. The reliance....
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....redit Rules, 2004 and utilize this credit in accordance thereto. Subsequently after re-making/refining/re-conditioning etc. the goods can be removed and the manufacturer has to pay duty liability on re-conditioned goods at the appropriate rates at the value determined under the valuation provisions provided under Central Excise Act. In this case also, there is no liability to pay any interest on the goods received back which are re-processed and removed from the data of original clearance. 4. The learned A.R. appearing for the Revenue reiterated the reasonings given by the lower appellate authority. 5. I have carefully considered the rival submissions. After hearing the argument, I find that the appeal itself can be disp....
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....4) shall apply mutatis mutandis for effecting such recoveries. (Provided that if the subject goods on receipt are found to be defective or damaged or unsuitable or surplus to the needs of the manufacturer, he may return the subject goods to the original manufacturer of the goods from whom he had obtained these and every such returned goods shall be added to the non-duty paid stock of the manufacturer of the subject goods and dealt with accordingly.) Explanation.- For the removal of doubts, it is hereby clarified that subject goods shall be deemed not to have been used for the intended purpose even if any of the quantity of the subject goods is lost or destroyed by natural causes or by unavoidable accidents (during transport from the place....