Delhi High Court clarifies Merchant Overtime charges in Central Excise case, Revenue appeal rejectedMerchant Overtime charges (MOT Charges) for service rendered by the officers of Central Excise during the normal working hours of the Central Excise department i.e. 10 A.M. to 6 P.M – Held that:- As per the decision in the case of M/s Sigma Corporation India Pvt. Ltd. [2004 (1) TMI 112 - CESTAT, NEW DELHI], there is no case for MOT charges in respect of service provided by Central Excise officers during the normal working hours - Revenue has challenged the said order of Tribunal in Delhi High Co... ... ... Issues:
- Interpretation of Merchant Overtime charges for services by Central Excise officers during working hours
- Applicability of Tribunal judgment in M/s Sigma Corporation India Pvt. Ltd.
- Decision of the Commissioner of Central Excise (Appeals) upheld based on Delhi High Court ruling

Interpretation of Merchant Overtime charges:
The case involved the issue of whether Merchant Overtime (MOT) charges were applicable for services provided by Central Excise officers during normal working hours. The Respondent, a manufacturer of processed fabrics, had not paid MOT charges for services rendered by officers during the period of April 2002 to June 2003. A Show Cause Notice was issued, demanding payment of Rs.1,48,827. The Commissioner of Central Excise (Appeals) allowed the Respondent's appeal, leading to the Revenue filing an appeal challenging this decision.

Applicability of Tribunal judgment:
The Commissioner (Appeals) relied on a Tribunal judgment in the case of M/s Sigma Corporation India Pvt. Ltd. However, the Revenue contested this judgment in the Delhi High Court. The High Court, in its order, clarified that there was no basis for MOT charges for services provided by Central Excise officers during regular working hours. Consequently, the Tribunal found no fault in the Commissioner's decision, based on the Delhi High Court ruling, and upheld the appeal rejection, thereby siding with the Respondent.

Delhi High Court ruling impact:
The pivotal aspect of the judgment was the Delhi High Court's ruling on the applicability of MOT charges for services by Central Excise officers during standard working hours. The High Court's decision, referenced in the Tribunal judgment, played a significant role in affirming the Commissioner's decision to allow the Respondent's appeal. This ruling established a legal precedent that influenced the outcome of the case, ultimately leading to the rejection of the Revenue's appeal. The judgment highlighted the importance of legal interpretations and precedents set by higher courts in shaping decisions at lower tribunals, ensuring consistency and adherence to established legal principles. Merchant Overtime charges (MOT Charges) for service rendered by the officers of Central Excise during the normal working hours of the Central Excise department i.e. 10 A.M. to 6 P.M – Held that:- As per the decision in the case of M/s Sigma Corporation India Pvt. Ltd. [2004 (1) TMI 112 - CESTAT, NEW DELHI], there is no case for MOT charges in respect of service provided by Central Excise officers during the normal working hours - Revenue has challenged the said order of Tribunal in Delhi High Court and Court vide its order reported in 2013-TIOL-323-HC-DEL-CUS has held in the favor of Respondents – Decided in favor of Assessee. CCE, Jaipur-II Versus M/s Banswara Textiles Mills Ltd.
Central Excise
2013 (7) TMI 497 - CESTAT NEW DELHI - TMI
CESTAT NEW DELHI - AT
Dated:- 9-7-2013
Appeal No. 1135 of 2006-SM - -
Central Excise
Mr. Sahab Singh, J. For the Appellant: Shri P.K. Sharma, D.R. For the Respondent: Shri Mayank Garg, Advocate JUDGEMENT Per Sahab Singh : This appeal has been filed by Revenue against the Order-in-Appeal No. 55(HKS)CE/JPR-II dated 18.1.2006. 2. The brief facts of the case are that the respondents M/s Banswara Textile are manufacturer of processed fabrics falling under Chapter 52, 54 and 55 of the Central Excise Tariff. The respondents are exporting the goods from the factory premises under the supervision of Central Excise officers posted in Banswara range. It was observed that during the period April 2002 to June 2003, the respondent had not paid the Merchant Overtime for service rendered by the officers of Central Excise during the normal working hours of the Central Excise department i.e. 10 A.M. to 6 P.M. A Show Cause Notice dated 26.8.2004 demanding amount of Rs.1,48,827/- was issued to the respondent and after due process the case was adjudicated and confirmed against the respondent. The respondent filed an appeal before the Commissioner of Central Excise (Appeals) who vide the impugned order has allowed their appeal. 3. Heard both sides. 4. I find that the Commissioner (Appeals) in para-5 of the Order-in-Appeal has relied upon the judgment of the Tribunal in the case of M/s Sigma Corporation India Pvt. Ltd. Revenue has challenged the said order of Tribunal in Delhi High Court and Court vide its order reported in 2013-TIOL-323-HC-DEL-CUS has held that there is no case for MOT charges in respect of service provided by Central Excise officers during the normal working hours. In view of the above decision of the the Hon'ble Delhi High Court, I find no infirmity in the order accordingly uphold the same and reject the Revenue's appeal. (Dictated & pronounced in open Court)
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