AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2017 (7) TMI 758
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....15.08.2011 and the entire duty of Rs. 62,50,000/- involved on the said five machines was paid on 06.08.2011. The appellant filed an intimation with regard to stoppage of 5 machines with effect from 16.08.2011 and the Range officer Range-I, Nizamabad sealed all the 5 machines at 00.10 hrs on 16.08.2011. They were subjected to duty on the basis of the number of machines installed and operated upon under the provision of Pan Masala Packing Machines. (Capacity determination and collection of duty) Rules, 2008 (PMPM Rules). They had installed and operated upon 35 number of machines during the month of June, 2011 where the duty was determined vide speaking order dated 06.06.2011 issued in file No. V/5/01/2011-Permission. The appellant during the ....
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.... 1st Appellate Authority set aside the order-in-original and allowed the appeal of the respondent herein with consequential relief, by recording that the entire order-in-original is liable to be set aside on the grounds of non-compliance to principles of natural justice. On merits it is recorded that the respondents herein had filed an application for stoppage of remaining machines with effect from 16.08.2011 and the said machines were sealed by the range officers which would indicate that there was no production from 16.08.2011 and that the proceedings of non-payment of duty for the month of July 2011 which is before the Hon'ble High Court cannot be considered even by the provisions of Rule 9 of the Pan Masala Packing Machines [Capacity De....
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....uty liability. 5. Learned counsel would draw my attention to the findings of the 1st Appellate Authority and also to Rule 9. It is his submission that Rule 9 is a stand alone Rule and the proviso referred to by the A.R. is in respect of the default made for the particular month and not for the earlier months. He would then further submit that Rule 10 is again a Rule which provides for abatement of the duty paid in a situation wherein in no manufacturing activity takes place. He reads the provisions of Rule 10 of PMPM Rules. He would submit that in a similar situation, Hon'ble High Court of Delhi in the case of Commissioner of Central Excise Delhi Vs Shakti Fragrances Pvt Ltd [2015 (324)ELT 390 (Del)] has specifically stated that when there....
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.... 2011. In my considered view, the abatement that is provided under Rule 10 will be applicable to the appellant herein and Revenue is mandated to refund the said amount which has been collected in excess by them from the respondent. The case of the Revenue in the grounds of appeal that 7th Proviso to Rule 9 will apply is totally an incorrect argument as Rule 9 talks about liability on an assessee for the discharge of duty on production of a particular month. In my view if an assessee stopped production entirely after defaulting the duty liability in a particular month, can it be said that as per Proviso 7 of Rule 9, the assessee is required to discharge the entire duty even if there is no production. The answer would be no, as liability to p....
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.... admittedly in the present case there has been a closure of the factory from 14th to 31st August, 2012 and an abatement order has also been passed on 28th August, 2012. However, the assessee would be liable to pay the interest for the period of late deposit of duty. 13. Consequently, the impugned order of the CESTAT does not call for interference. No substantial question of law arises therefrom." 8. It can be seen that the Hon'ble High Court of Delhi has categorically stated that differential duty, if any, can be demanded from an assessee only if there is production of the goods under PMPM Rules, if applied to the case in hand it would mean that there cannot be any demand of duty from the respondent for the period from 16.08.2011 to 31.08....