AI Drafter 
TaxTMI 
TaxTMI 
2015 (12) TMI 224
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....n merits in favour of Revenue but on limitation, benefit was extended to appellant to which implied dropping of almost entire liability except on seized goods. Against the said order of the Tribunal, both, the appellants as also Revenue filed appeals before the hon'ble High Court of Bombay at Nagpur Bench and the hon'ble High Court vide order dated February 13, 2015 in Central Excise Appeal No. 32 of 2014 filed by the Commissioner of Central Excise, Nagpur II and Central Excise Appeal No. 3 of 2015 filed by M/s. Larsen & Toubro Ltd. passed the following order: Both these cross-appeals are filed by the Revenue as well as the Assessee being aggrieved by the order of the CESTAT dated 23.07.2014 The appeal before the CESTAT was filed by assessee challenging the order passed by the Commissioner of Central Excise, Nagpur thereby confirming the order passed by the Assessing Authority and demanding dues to the tune of Rs. 1,61,61,27,251/- Rs. 6,37,544/- along with interest. The learned CESTAT cursorily observed in para 3.2 that the extended period of limitation is not invokable and, therefore, the goods are not liable for confiscation. The learned CESTAT also observed that....
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....that out of the earlier mentioned six items, two items, trucks and dumpers are classifiable under Chapter 87 while the remaining four are under Chapter 84. The second difference that we find in the case of JCB, all the parts were proposed to be valued under Section 4A of the Central Excise Act. In the present case, Revenue has taken the view that activities undertaken by the appellant are covered under Section 2(f)(iii) read with Third Schedule to the Central Excise Act, and hence amounts to manufacture. Further, in respect of packed parts, components and assemblies the same are required to be valued under Section 4A while in respect of unpacked parts, components and assemblies value is required to be determined under Section 4. The third important difference in the present case is that while in the case of JCB Ltd. the demands were for the period prior to February/April 2010 and the appellants in that case were paying duty under Section 4A after February/April 2010, in the present case, demand is even for the period February/April 2010 April 2011, the appellants even after the removal of the word automobiles in February/April 2010 and specifying particular headings and Chapters bo....
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....el are the same which were raised in the case of JCB India Ltd. (supra). One of the Members deciding the present case was also part of the Division Bench which had decided the case of JCB India Ltd. Shri K.M. Mondal, Special Consultant had argued for Revenue in the case of JCB India Ltd. However, in the present appeals Shri Hitesh Shah, Commissioner (AR) is representing the Revenue. Shri Hitesh Shah has provided additional material in support of Revenues contention. 7. Since main issue starts with the scope of the term automobile various case laws and Boards circular are the ones which were discussed at great length in the case of JCB India Ltd., we would be reproducing many parts from the Tribunals order in the case of JCB India Ltd. 8. The learned Senior counsel reiterated various submissions made by him during the hearing of JCB India Ltd. (supra). The said submissions are not being repeated for sake of brevity. Learned senior counsel also submitted detailed written submissions on 8th September, 9th September and after the hearing was over. The main contention in brief are: 8.1. The appellants have not subjected all the parts of hydraulic excavators, dozer, wheel loader....
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....udes construction equipment vehicle which in turn is defined as: construction equipment vehicle means rubber tyred, (including pneumatic tyred), rubber padded or steel drum wheel mounted, self-propelled, excavator, loader, backhoe, compactor roller, dumper, motor-grader, mobile crane, dozer, fork lift truck, self-loading concrete mixer or any other construction equipment vehicle or combination thereof designed for off-highway operation in mining, industrial undertaking, irrigation and general construction but modified and manufactured with on or off or on and off highway capabilities. The learned AR further submitted that the same definition appears in the IS 14272 (2011): Automotive vehicles Types Terminology published by the Bureau of Indian Standards. The above Standards indicate that all self propelled vehicles, whatever may be their use, are considered as automotive vehicles or automobiles. Vehicles with steel drum wheels i.e. crawlers or track laying or chain mounted vehicles are also considered as automotive vehicles. Hydraulic excavators which are self propelled, whether wheel mounted or crawlers, are considered as automotive vehicles. Vehicles designed for off hig....
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....he functional machinery is mounted on the automobile. Hence, goods are automobiles. 9.2. The learned AR further submitted that the all the six items undoubtedly indicates that these are self propelled vehicles which works either on rubber or pneumatic wheels or steel drum wheels. Hydraulic excavators are available with rubber/pneumatic tyres or with steel drum wheels. A perusal of the literature of each of the items would indicate that they have automobile aspects as also the machinery aspect. Automobile aspects are like independent power, speed, operating weight specification, etc. 9.3. Learned AR further submitted that all the items are automobiles for the purpose of Section 2 of the Air (Prevention and Control of Pollution) Act, 1981, which defines the term automobile as: 2(e)? automobile means any vehicle powered either by internal combustion engine or by any method of generating power to drive such vehicle by burning fuel; 9.4. It is further submitted by the learned AR that this Tribunal in the case of Sociedade de Formento & Ors. vs. Commissioner of Customs 1987 (29) ELT 620 (T), considered crawler type vehicles and held them to be conveyances. It is his submissio....
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....s and no restriction can be put on the general meaning of any entry in a taxing statute as has been held in the following cases: Commissioner of Sales Tax vs. Agarwal & Co. 1983 (12) ELT 116 (Bom.); Indian Tool Manufacturers vs. Collector of Central Excise, Poona 1984 (18) ELT 527 (Tribunal); Indian Tool Manufacturers vs. ACCE 1994 (74) ELT 12 (SC); Standard Pencils (P) Ltd. vs. Collector of Central Excise, Madras 2002 (145) ELT 278 (SC); Swaraj Mazda Ltd. vs. Commissioner of Central Excise, Chandigarh II 2010 (257) ELT 264 (Tri.-Del.); The Western India Plywoods Ltd. vs. Commissioner of Central Excise 1985 (19) ELT 590 (Tribunal) 10. The learned AR further submitted that the goods cleared by the appellants have been subjected to the process amounting to manufacture as even in the case of unpacked goods it is not disputed that they were putting the labels and the definition under Section 2(f)(iii) very clearly mentions that labelling will amount to manufacture. It was submitted that the word label is not with reference to the container. In any case, as admitted by the appellant, these goods are not being packed because of their size. In such a situation even pu....
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....oduct marketable to the consumer, as manufacture. It was also submitted that the term container has been considered in the following cases: G. Claridge & Co. vs. Commissioner of Central Excise 1991 (52) ELT 341 (SC); Parksons Printers vs. Commissioner of Central Excise 1996 (86) ELT 603 (T) It was submitted that when the term container is found independently, in a broad sense it indicates a receptacle which contains and in a narrow sense a receptacle in which articles are covered or enclosed. Hence, the term container cannot be synonymous with a unit packing or a package or a closed receptacle. It was submitted that the goods are received by the appellant in cartons, wooden and tin cases and are subject to, in some cases, unpacking and repacking and labeling and in some cases the goods were unpacked and then put in pre-printed pouches. In some cases, goods are labelled whether with a tag or sticker or label containing relevant information which is important to the appellant and its buyer and to the process of sale and consumption of such goods. It was his submission that in view of this position the process undertaken by the appellant helps in marketing of the goods also. ....
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....s Court and the binding effect in terms of Article 141 of the Constitution. 12. As far as the entitlement to CENVAT credit is concerned, the learned AR submitted that the appellants have not submitted any document either before the adjudicating authority or before this Tribunal and hence there is no question of remand for deciding liability of CENVAT credit in view of judgment of Hon'ble Supreme Court in the case of Kores India Ltd. vs. Commissioner of Central Excise 2004 (174) ELT 7 (SC) which is re-affirmed in Kores India Ltd. vs. Commissioner 2015 (318) ELT A252 (SC). 12.1. As far as the plea of benefit of cum-duty is concerned, it is submitted that benefit of cumduty cannot be extended in the present case in view of the following case laws: Amrit Agro Industries Ltd. vs. CCE, Ghaziabad 2007 (210) ELT 183 (SC) Ahmednagar Rolling Mills Pvt. Ltd. vs. CCE, Aurangabad 2014 (300) ELT 119 (Tri.-Mumbai) 12.2. The learned AR submitted that as far as extended period of limitation is concerned, it cannot be said that the appellant were not aware of the provisions of Section 4A or the parts are not covered under Section 4A. In fact they themselves were importing parts of....
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....xible coupling, bracket, oil cooler, fan for ROC, radiator, radiator cap, switch, wiring harness, bearing, pipe, swing machinery case, shaft, cylinder, collar, seal kit stick cylinder, gear assy, hyd tank, fuel tank assy (osp), etc. Most of these items are used in car, trucks and other vehicles. Car, trucks, etc. are even according to appellant are automobiles. Description of parts components and assemblies clearly indicates these are parts, components and assemblies of automobiles. 14. Relevant sections, notifications and circulars are as under: 14.1. Section 2(f)(iii) of the Central Excise Act, 1944 reads as under:- (f) manufacture includes any process,- i) (ii) (iii) which, in relation to the goods specified in the Third Schedule, involves packing or repacking of such goods in a unit container or labelling or re-labelling of containers including the declaration or alteration of retail sale price on it or adoption of any other treatment on the goods to render the product marketable to the consumer, and the word manufacturer shall be construed accordingly and shall include not only a person who employs hired labour in the production or manufacture of excisable go....
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....t is necessary in the public interest so to do, hereby makes the following amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 2/2006-Central Excise (N.T.), dated the 1st March, 2006, G.S.R. 113(E), dated the 1st March, 2006, namely:- In the said notification, in the TABLE, after S. No. 96 and the entries relating thereto, the following shall be added, namely:- (1) (2) (3) (4) 97 Any heading Parts, components and assemblies of automobiles 33.5% 98 3808 30 40 Plant-growth regulator 30% 99 9603 21 00 Toothbrush 28.5%. 2. This notification shall come into force on the 1st day of June, 2006. 14.5. On 24th December, 2008, above Notification was replaced by Notification No. 49/2008-C.E. (N.T.) However, there was no change in the description of entry with which we are concerned except that abatement percentage was reduced from 33.5% to 30%, and was listed as entry No. 108. 14.6. The Notification No. 49/2008-C.E. (N.T.) was amended vide Notification No. 9/2010-C.E. (N.T.) dated 27/02/2010 and the said entry was replaced as:- S. No. Chapter Heading, sub-he....
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....67/38/2008-CX.4 dated 16.12.2008 14.12. The first Circular is regarding leviability of cess under Automobile Cess Rules, 1984 on Earthmoving machinery. The said Circular is as under:- Automobiles - Cess not chargeable on earthmoving machinery F. No. 262/15/86-CX.8, dated 14/07/1987 Government of India Ministry of Finance (Department of Revenue) New Delhi Subject: Cess on automobiles - Clarification Regarding. A doubt has arisen whether Earthmoving machinery is leviable to cess under the Automobile Cess Rules, 1984. 2. The matter has been examined in consultation with the Ministry of law which has opined that since Earthmoving machinery including dumpers fall under item 11 of the 1st Schedule to the I (D & R) Act, 1951 and not under Heading 7(5) of the said schedule, no cess would be chargeable on the same under the Automobile Cess Rules, 1984. The opinion of the Law Ministry has been accepted by the Board. 14.13. Board's Circular No. 22/90-CX.4 dated 11/07/1990 which reads as:- Circular No. 22/90-CX.4, dated 11/07/1990 [From F. No. 156/15/90-CX.4] Government of India ....
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.... Supreme Court and Madras High Court, this Tribunal came to the conclusion that Automobile includes tractors and earth moving equipments. Thus Tribunal took a view contrary to the said Circular. Revenue has not challenged the said judgment of this Tribunal and therefore the Circular dated 11/07/1990 is no more valid and this circular does not represent the correct legal position. In our considered view any reliance on the said circular would be contrary to judicial verdict. However, perhaps, unaware of the said judgment, Board issued Circular on 16/12/2008. 14.15. Boards Circular No. 167/38/2008-CX.4 dated 16/12/2008 is as under:- Automobile parts, components and assemblies - Scope, for MRP based valuation F. No. 167/38/2008-CX 4, dated 16-12-2008 Government of India Ministry of Finance (Department of Revenue) Central Board of Excise & Customs, New Delhi Subject: MRP based assessment - Clarification regarding the scope of entry No. 97 of the Notification No. 2/2006-C.E. (N.T.) inserted vide the amending Notification No. 11/2006-C.E. (N.T.) [Present entry No. 107 in the Notification No. 14/2008-C.E. (N.T.)] - Regarding. ....
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..... It is also important to note that there is no specific entry for components or assemblies of automobiles in the Tariff, therefore, this also supports the view that all goods which are commonly known and sold in the trade as parts, components and assemblies are covered by said entry, irrespective of their clarification in the Tariff. Hence, the term parts, components and assemblies of automobiles includes items like batteries, brake assembly, tyres, tubes and flaps, IC engines, ball bearing etc. 4. The contents of this clarification may be brought to the notice of trade and industry. 15. In the case of JCB India Ltd., after considering earlier mentioned legal provisions, circulars and case laws and arguments of both sides (which were repeated in the present case), this Tribunal has observed as under: 17.1 We have considered the rival submissions, and given considerable thought to these submissions. At the outset we note that all the items in question viz. Loader, Backhoe Loader and Road Roller are self propelled, work with internal combustion engine using fuel such as diesel, have four wheels and are rubber tyred (road roller may have two rubbe....
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....view, the High Court has correctly decided the matter and the impugned order does not call for any interference by us. However, the question whether any motor vehicle has entered into a local area to attract tax under the Entry Tax Act or any concession given under the local Sales Tax Act will have to be dealt with in the course of assessment arising under the Entry Tax Act. Appeals are accordingly dismissed." 17.5 We note that Hon'ble Supreme court in the case of M/s. Central Coal Fields Ltd. (supra), while considering the issue about taxation of Dumper and Rocker under motor vehicle Act, 1988 has observed as under:- 7. Learned Counsel for the appellants in these appeals have not challenged the view of the High Court regarding vires of the impugned Act before us or to its retrospectively but have addressed us only on the fact situation to contend that the Dumpers (which includes Rockers) are vehicles not adapted for use upon roads and, therefore, they are outside the scope of Section 2(b) of the impugned Taxation Act, 1975 and hence not within the ambit of the charging Section. Section 3(1) provides that subject to the other provisions of the Act, on and from....
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....ctor that these Dumpers run on tyres, in marked contrast to chain plates like cater pillars or military tanks. By the use of rubber tyres, it is evident that they have been adapted for use on roads, which means they are suitable for being used on public roads. The mere fact that they are required at places to run at a particular speed is not to detract from the position otherwise clear that they are adapted for use on roads. The very nature of these vehicles make it clear that they are not manufactured or adapted for use only in factories or enclosed premises. The mere fact that the Dumpers or Rockers as suggested are heavy and cannot move on the roads without damaging them is not to say that they are not suitable for use on roads. The word adapted' in the provision was read as suitable in Bolani Ores case by interpretation on the strength of the language in Entry 57, List-II of the Constitution. Thus on that basis it was idle to contend on behalf of the appellants that Dumpers and Rockers were neither adaptable nor suitable for use on public roads. Thus on, the fact situation, we have no hesitation in holding that the High Court was right in concluding that Dumpers and Rockers....
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....at construction site is to be classified as "tyres for motor vehicle". At the relevant time tyres were classified under three categories viz. for motor vehicles, for cycles & all other tyres. Further, Item No. 34 defined motor vehicles. It is in this context that Hon'ble Supreme Court has held that such tyres cannot be considered tyres of motor vehicles. In present case issue is whether parts, components and assemblies of Loader, Backhoe Loader & Road Roller can be considered as Parts, components and assemblies of automobiles. In our view, Hon'ble Supreme Court judgment does not help the cause of Respondents. 17.9 Another judgment quoted is that of Hon'ble Rajasthan High Court, in the case of Commissioner of Income Tax Vs. Gotan Lime Stone Khanij Udyog reported in 2007(173)-GJX-0443-RAJ. Here the issue was road transport vehicles were excluded from the Investment Allowance and Income Tax department was denying the Investment Allowance considering tipper and hydraulic excavator as road transport vehicle. Hon'ble High Court took the view that these are non-transport vehicle by virtue of explanation attached to the definition. We do not consider this helps the....
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....s own motor - internal combustion engine. 39. Motor vehicle has been defined as a motor driven vehicle for use on roads and highways. 40. In both the exemption Notifications No. 91/68-C.E. and No. 61/86- C.E., the expression "automobiles" has been used along with the "railway carriages" and the "air-crafts". Railway carriages' move on fixed rails, and the aircrafts' fly in the air and run on the runways. Taken all the three - automobiles, railway carriages and aircrafts - together, they cover a very wide area. 41. The word automobile' was first used in France in the late 1880s. It comes from the Greek word Auto meaning self, and the French word Mobile meaning moving. Literally, it means a self-propelled vehicle. 42. While its dictionary meaning is motor-car', the way the expression "automobile" has been used in the Notification along with railway carriages and the aircrafts, any restricted meaning given to it does not appear to be consistent with the scheme discerned from the reading of the notifications as a whole. 43. As observed by the Hon'ble Supreme Court in the case of Jain Engineering Company v. Collector of Cu....
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....get support from the changes made in February/April 2010. In order to avoid the terminology automobile, (being not defined in Act/Tariff) specific heading of the Central Excise Tariff were introduced in the Notification No. 49/2008-C.E. (NT) in February 2010 vide Notification No. 9/2010-C.E. (N.T.). Apparently this was done in haste and Government had to further amend the amendment made in February, 2010 within two months to specifically include headings relating to earth moving machinery. Not only this, corresponding amendment in Third Schedule was forgotten and the next year retrospectively amendment had to be brought with effect from 27.02.2010/29.04.2010. Thus a holistic look of these amendments, only supports that Parts, components and assemblies of automobiles included that of Loader, Backhoe Loader & Road Roller and were covered from June, 2006 onwards. 18.7 One of the contention of Ld. Senior Advocate is that Board's Circular dated 16.12.2008 stated that hydraulic excavators cannot be treated as automobiles and this Circular is binding on Revenue Officials and a stand contrary to that is not permissible. We have gone through this Circular. We note that this is ....
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....a 9. It must be remembered that law laid down by this Court is law of the land. The law so laid down is binding on all Courts/Tribunals and Bodies. It is clear that circulars of the Board cannot prevail over the law laid down by this Court. However, it was pointed out that during hearing of Dhiren Chemical's case because of circulars of the Board in many cases the Department had granted benefits of exemption Notifications. It was submitted that on the interpretation now given by this Court in Dhiren Chemical's case, the Revenue was likely to reopen cases. Thus Para 9 was incorporated to ensure that cases where benefits of exemption Notification had already been granted, the Revenue would remain bound. The purpose was to see that such cases were not reopened. However, this did not mean that even in cases where Revenue/Department had already contended that the benefit of an exemption Notification was not available, and the matter was sub-judice before a Court or a Tribunal, the Court or Tribunal would also give effect to circulars of the Board in preference to a decision of the Constitution Bench of this Court. Where as a result of dispute the matter is sub-judice a Court/Tri....
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....these are the conclusions which follow if the observations of this Court in the two cases of Dhiren Chemicals Industries are taken to their logical conclusion. 26. I am of the view that in a situation like this, the Customs authority should obey the constitutional mandate emanating from Article 141 read with Article 144 rather than adhering to the letter of a statutory provision like Section 151A of the Customs Act. The Customs authority should act subservient to the decision of the highest constitutional Court and not to the circular of the Board which is denuded of its rationale and substratum under the impact of the authoritative pronouncement of the highest Court. Alternatively, Section 151A has to be suitably read down so that the circulars issued would not come into conflict with the decision of this Court which the Customs authorities are under a Constitutional obligation to follow." 18.10 In view of above case laws, we are of the view that even if the Circular dated 16.12.2008 is with reference to Hydraulic Excavators which are motor vehicle, the same is required to be ignored in view of decisions on the issue by Higher Judicial forums. We therefore do not....
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....tc. Keeping in view the discussion relating to Loaders, Backhoe Loaders in the case of JCB India Ltd. (supra), in our considered opinion, these items will also be covered by the term automobile. 16.4. The remaining items are dozers and hydraulic excavators. These two items, according to learned counsel for the appellant, are crawler type or chain plates i.e., there is a steel drum and below the steel drum there is a chain on which these items move. Learned counsels submission is that since tyres are not used in these two equipments these cannot be considered as automobiles. We would like to mention that in the case of JCB India Ltd. (supra), equipments which have on a steel drum wheel and move on chain system or crawler, were not being discussed and therefore, the discussion was confined to the tyred wheel mounted equipment. 16.5. We also note that the learned AR has also provided very valuable inputs during argument which were not available while deciding the matter in the case of JCB India Ltd. The learned Commissioner (AR) has submitted copy of the Automotive Industry Standard AIS 53, published in 2005 by the Automotive Research Association of India, Pune wherein road vehi....
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....nsidered as motor vehicle or automobile. We find that this sentence is being taken out of context by the learned senior counsel. The said sentence was written while trying to discuss the Boards Circular dated 06/12/2008 as the said circular though talked about hydraulic excavator, but did not clearly spelt out what type of hydraulic excavator they are talking about. There was no question of this Tribunal holding that hydraulic excavator is not motor vehicles/automobile. This would be contrary to the judgment of the hon'ble Supreme Court in the case of Bose Abraham vs. State of Kerala dated 01/02/2001 (Civil Appeal No. 2779 of 1998 & Ors.) [2001] 121 STC 614 (SC). 18. We find that the learned senior counsel for the appellant in their written submissions after the hearing, has submitted that the said details relating to AIS/53 or BIS 14172 (2011) should not be taken into account as these are not forming part of the show cause notice and the Commissioner (AR) has not followed the CESTAT procedure to produce the same. We do not find any merit in the contention. First of all, the show cause notice propose to consider all the six items including excavator, motor graders, wheel loa....
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.... to the truth, incorrect interpretation taken by some authority cannot supersede the judicial decision on the issue. We also agree with the Commissioner (AR) that even the circular of 2008 was not binding circular and it would be seen from the circular that it is only suggestive and is not a conclusive or directive circular. 22. We also note from the list of parts submitted during the hearing, the parts are of a type used in various automobile items and keeping in view the fact that the term used in the Notification and Third Schedule is parts, components and assemblies of automobiles, falling under any Chapter (thus not restricted to few parts) which is a very wide term, we are of the view, even the term automobile has to be given a wider meaning. We also note that large number of such parts, components and assemblies are interchangeable in different road vehicles including construction equipment vehicles. Thus wider meaning to the term automobile is to be given. 23. The next issue is relating to the scope of Section 2(f)(iii), learned senior counsel has submitted that the said section was introduced in 2003 and at that point of time in the explanation to the Finance Bill it....
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....e in respect of items when the retail selling price is very high compared to the ex-factory price. This is particularly true in the case of spare parts of automobile. Spare parts of automobiles are generally priced very high compared to the ex-factory values of such parts. In order to capture the value addition in such situation and for similar items, Section 2(f)(iii) was introduced and the purpose of the said Section will be achieved if activity of putting a tag or label which will identify that part number of the equipment is considered as manufacture. 25. The learned senior counsel has submitted that since the definition of manufacture under Section 2(f)(iii) is a deeming provision, strict interpretation of the same should be given. While we do agree that there should be strict interpretation, however, interpretation should not be so strict so as to defeat the very purpose of deeming provision. In this context we refer to the decision of the hon'ble Supreme Court in the case of Industrial Supplies Pvt. Ltd. vs. Union of India & Others (1980) 4 SCC 341 wherein it was held as under: 25. It is now axiomatic that when a legal fiction is incorporated in a statute, the Cour....
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....said section would be applicable only for the excisable goods. Learned Commissioner (AR), on the other hand, submitted that the term excisable goods is used under Section 2(d). In third schedule to the Central Excise Act, the term used is goods. Similarly, under Section 2(f)(iii) there is no such requirement that the inputs should be manufactured in India only and cannot be imported. 27.1. We have considered the submissions made by both the sides. For determining whether a particular process amounts to manufacture it is not relevant whether the inputs are locally produced or imported. What is important is the end product and whether the manufacturing process amounts to manufacture or not. In the present case, there is no dispute that the activity undertaken by the appellant amounts to manufacture under Section 2(f)(iii). The fact that inputs were imported is immaterial and hence the submission made by the learned senior counsel is rejected. 28. From the facts of this case, we find that the Notification relating to Section 4A were amended on 27/02/2010 and 29/04/2010. Under the said Notification the term automobile was replaced by specific headings of the Central Excise Act Ta....
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....ended period of limitation is a mixed question of facts and law and each case has to be decided on the facts of that case. In the present case, it is an admitted position that the appellant were importing parts of scania truck and while they were clearing the parts of the scania trucks they were paying CVD under Section 4A of the Central Excise Act. Thus, it clearly proves that they were aware that duty under Section 4A is required to be levied. Once the duty under Section 4A is chargeable on any item, then if such an item is again repacked or relabelled or any process are undertaken, such activity is considered as an activity of manufacture, then the appellant is required to pay excise duty on the same. It is a different matter that in such cases, at the time of importation CVD would have been paid and the manufacturer will be entitled to take credit of the same and it is possible in some cases there may not be any additional liability. However, the fact remains that the procedure has to be followed and where there is any additional liability or not will have to be checked by the excise authorities. We also observe that even though the appellant was paying CVD on the basis of MRP ....
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....emand has been raised under Section 4, they are entitled to cum-duty benefit. We find that the learned Commissioner (AR) has opposed the same and quoted certain judgments of this Tribunal. We find that on this issue there were contrary judgments of various High Courts/Supreme Court and in order to resolve the issue, under Section 4(1) an explanation was added in 2003 to sort out the issue. The Explanation is as under: Explanation. - For the removal of doubts, it is hereby declared that the price-cumduty of the excisable goods sold by the assessee shall be the price actually paid to him for the goods sold and the money value of the additional consideration, if any, flowing directly or indirectly from the buyer to the assessee in connection with the sale of such goods, and such price-cum-duty, excluding sales tax and other taxes, if any, actually paid, shall be deemed to include the duty payable on such goods. 33. As per the said explanation, in the facts of the present case, the appellant would be entitled to cum-duty benefit. We accordingly extend the same and set aside the impugned order as far as the benefit of cum-duty is concerned. 34. Learned senior counsel for the ap....