TaxTMI 
TaxTMI 
2013 (8) TMI 685
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....m the stage of pulp, in a factory, and such pulp contains not less than 75% by weight of pulp made from materials other than bamboo, hard woods, soft woods, reeds etc. The respondents were clearing their final product, packaged in wrapper and availed the exemption of first clearance of 3500 MT. The Revenue entertained a view that while availing the exemption of 3500 MT, the weight of wrapper was not taken into consideration and as such, there is clearance of Duplex Board/Paperboard and wrapper in excess to the extent of 26.017 MT. The above view was based upon the statement of Shri Bhupinder Singh, Managing Director deposing that the weight of the wrapper was not being shown in the invoices and was not included/mentioned therein. Accordingly the proceedings were initiated against them resulting in confirmation of demand of duty of Rs.66 ,993 /- along with confirmation of interest and imposition of penalty upon them. On appeal, the Commissioner (Appeals) has set aside the impugned orders. Hence the present appeals. 3. For better appreciation of the reasoning adopted by the Commissioner (Appeals), we reproduce the relevant para as under: "I have carefully gone through ....
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.... on record to indicate that the price charged in the invoice is not the sole consideration and/ or there was some flow back/other consideration involved in this case. In the absence of any such evidence and in view of the above discussions the charge levelled against the appellants in the show cause notice and upheld in the O-I-O is not sustainable. Accordingly, impugned O-I-O confirming demand of duty/cess/interest and imposing penalty on the appellants is set aside." 4. As is seen from the above, we find that there is no evidence on record indicating that the quantity of 3500 MT cleared by the appellants during the financial year 2001-2002. was without taking into consideration the weight of wrapper paper. It is undisputed that the goods were entered in the RG-1 register after wrapping of the same with the wrapper paper. In the invoices also reflected upon the total weight of the packaged paper, which would undisputedly include the weight of wrapper also. The appellant have also referred to trade parlance whereas chargeable weight included the weight of rim and reel wrappers, strings etc. There is no practice showing the weight of wrapper paper and charging the same separately. ....
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....nly to the extent it is necessary for smooth reading of this order. 8. In these cases, the two appellants were manufacturing both items paper for sale like Duplex Board and also wrapper paper for wrapping such paper products for sale. The wrapper paper manufactured by them were used in the factory of the manufacturer, without payment of duty, for packing the paper products for sale manufactured by them and cleared outside the factory. The appellants were availing exemption under Notification 6/2001-CE (S. No. 86) dated 01-03-2001 and Notification 06/2002-CE (S. No.86) dated 01-03-2002 for different periods involved. This exemption was available only for the first clearances of paper up to a quantity of 3500 MT, in a financial year. The case made out by Revenue is that for reckoning the quantity of first clearances the appellant had taken into account only paper products for sale cleared outside the factory and not the wrapping paper used for wrapping such products sold. If the quantity of wrapping paper is also taken into account the case of Revenue is that M/s B.K Paper had cleared 26.017 MTs of paper in excess of 3500 MT and M/s AST Paper Mills have cleared 36.725 MTs of paper i....
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..../95-CE would not apply in this case such quantity also should be reckoned as cleared under the impugned exemption up to the quantity of 3500 MTs. 12. In view of the above arguments I consider that the impugned order is passed wrongly and the Order-in-Original need to be restored in the matter of duty and interest demanded. In the matter of penalty, by following the decision of the Delhi High Court in the case of K.P. Pouches Pvt. Ltd. v. Union of India-2008 (228) E.L.T. 31 (Del.) it is proper to extent the benefit of paying 25% of the duty confirmed within thirty days of receipt of the final order in this case. POINTS OF DIFFERENCE OF OPINION In the facts and Circumstances of the case ,- Whether it is to be considered there the quantity of paper and paper products sold are inclusive of the weight of wrapping paper and it is to be concluded that the appellants have claimed exemption only for 3500 MTs of paper during the financial years as held by Member (Judicial) OR Whether it is to be considered that the quantity of paper and paper products cleared stated in the invoice is net of the packing material and it is to be concluded the appellants have claimed exemption for quantit....
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....ellants have claimed exemption for quantity of paper more than 3500 MTs during the relevant financial years as held by Member (Technical)" 16. Above difference in opinion was heard from time to time and both sides are on rivalry stand. 17. Appellant says that when the value charged in the invoices was inclusive of the wrapper itself there cannot be a conclusion that the weight of the paper was not considered for determining the weight of total clearance in relevant financial year. Apart from this contention, appellant's further contention is that it is a normal practice in the industry that the weight of the paper is stated on the label containing the paper packets. Therefore nothing can be concluded against the appellant on the presumption that the weight did not include the weight of the wrapper. So also the instruction of the Board was scrupulously followed. Therefore, weight of the wrapper cannot be said to have been excluded for the computation of the total weight of the goods cleared. Appellant fully relied on the finding of learned Judicial Member. 18. Revenue contends that when the Managing Directors of both the Appellant companies explained factual background of the cas....
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....ember was based on presumption without being based on evidence to show weight of wrapper (container) cleared, has merit. 23. It is strange how Ld. Commissioner (A) ignored the fact that wrappers cleared were excisable goods and material for the purpose of grant of notification. But he based his decision on irrelevant considerations. If the weight of wrapper in question was also material that needed thorough scrutiny. Ignoring such aspect learned Commissioner buried interest of Revenue. When the appellant had a clear admission of the fact that it had not recorded the weight of the wrapper, the Appellate Commissioner reached to a wrong conclusion. His order was based on no evidence except baseless appreciation of part of recorded statement ignoring material and crucial part thereof. That is contrary to rule of law. So also decision based irrelevant consideration is perverse. 24. Ld. Technical Member has rightly examined the aspect of weight of wrapper by his elaborate order recording the facts in para 8 thereof. He has brought out the implication of section 14 of the Central Excise Act 1944 and relevancy thereof in the adjudication process. The statement having been recorded under ....