2020 (8) TMI 474

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.... admitted by a bench of this Court vide order dated 02.04.2012 on the following substantial question of law: (i) Whether on the facts and in the circumstances of the case, the tribunal is justified in holding that as per provisions of Section 145A the value of closing stock need not be increased by State excise duty as Excise duty was neither paid nor incurred without appreciating the law that the goods became dutiable on the day of manufacturing and the liability, therefore, stand incurred on that day and consequently the value of closing stock should have been increased by the amount of liability incurred? 2. Facts giving rise to filing of this appeal briefly stated are that the assessee is a private limited company engaged in....

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....1.2010 inter alia held that Tribunal has not taken into consideration the method of accounting under Section 145A, which came into force with effect from 01.04.1999. The matter was therefore, remitted for decision afresh with reference to Section 145A of the Act. The Tribunal by an order dated 12.08.2011l inter alia by placing reliance on decision of the Supreme Court in 'COMMISSIONER OF CENTRAL EXCISE VS. POLYSET CORPORATION AND ANOTHER', 115 ELT 41 (SC) held that till date of clearance of goods, excise duty payable on such goods does not get crystallized and assessee cannot be said to have incurred the excise duty liability. Thus, it was held that in respect of the excise goods not being removed, no liability is accrued and there ....

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....ants shall be removed from any distillery, brewery, warehouse or other place of storage established or licensed under this Act, unless the duty, if any, imposed under this Act has been paid or a bond has been executed for the payment thereof." 6. Thus, it is evident that assessee's liability to pay duty on the goods manufactured arises only at the time of removal of the same from its premises, be it distillery, or a warehouse or any other place of storage established or licensed under the Karnataka State Excise Act and not at any time earlier. The aforesaid issue is no longer res integra in view of decisions of Supreme Court in Polyset Corporation supra and Wallace Flour Mills Co. Ltd. The same view has been reiterated in 'MARUTI....