TaxTMI 
TaxTMI 
2023 (9) TMI 1133
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....bacco & Unmanufactued Tobacco Packing Machines (Capacity Determination & Collection of Duty) Rules, 2010 (Rules), goods manufactured by the appellant qualified as 'notified goods' and were thus, leviable to central excise duty on the basis of capacity of production under Section 3A of the Central Excise Act and not on the basis of actual production and clearance. The rate of duty on chewing tobacco had to be determined in terms of the Notification No.16/2010-CE dated 27.02.2010 read with Rule 7 of the Rules. 4. In accordance with Rule 6 of the Rules, the Appellant had filed declaration during the relevant period, disclosing relevant information viz., number of packing machines available at the factory, number of machines installed, retail price of the pouch, details of final product etc. In the said declarations, the Appellant also declared the maximum speed at which the machines can be operated for packing notified goods viz. 90 - 100 pouches per minute. 5. The above declarations filed by the Appellant were duly verified by the concerned jurisdictional officer and necessary enquiries were also made including physical verification. Thereafter, the declarations filed by the Appell....
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.... quantity, as determined by Assistant Commissioner, therefore irrespective of the fact that the machine of the Appellant is single track-line, it will be considered as two machines for the purpose of payment of duty. 10. Against the said orders, the appellant is before us. 11. The Ld.Counsel, appearing on behalf of the appellant submits that the issue has been settled by the Circular issued by CBEC and various decisions in their favour, wherein it has been held that no further demand is payable on the basis of actual production of goods, therefore, impugned orders are to be set aside. 12. Heard the parties, considered the submissions. 13. We find that after adjudication of the impugned matters, CBEC issued a Circular No.980/4/2014-CX dated 24.01.2014, which is extracted below for ease of convenience :- Circular No. 980/4/2014-CX., dated 24-1-2014 F.No. 354/120/2011-TRU Government of India Ministry of Finance (Department of Revenue) Central Board of Excise & Customs, New Delhi Subject : Divergent practices of assessment with respect to compounded levy scheme applicable for smokeless tobacco products - Regarding. Representations have been received from trade and ....
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..... Difficulties faced, if any, in implementation of this Circular may be brought to the notice of the Board. 8. Hindi version follows." The said Circular clearly clarifies that duty is to be paid by the assessee in terms of the Chewing Tobacco & Unmanufactued Tobacco Packing Machines (Capacity Determination & Collection of Duty) Rules, 2010, which has been determined by the adjudicating authority and on that basis the appellant has paid the duty, therefore, if during physical verification production is found more, no duty is payable by the appellant and the said issue also examined by this Tribunal in the case of Kaipan Pan Masala Pvt.Ltd. v. Commissioner of C.Ex., & S.T., Bhopal [2016 (344) E.L.T. 662 (Tri.-Del.)], wherein this Tribunal observed as under:- "7. During the period under dispute, the deemed production of Gutkha was determinable under Rules 4 and 5 of the Capacity Determination Rules, 2008. According to Rule 4 of the said Rules, the relevant factor was the number of machines installed in the factory. Rule 5 of the said Rules fixes the deemed quantity manufactured, by use of one packing machine, with retail sale price printed on the pouch. The above provisions rea....
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....d for this purpose in case of multiple line/multiple track machine, where the multiple track are not for performing additional processes involving moulding or giving definite shape to pouches with a view to distinguish the brand or to prevent the counterfeiting of the goods, each track is to be treated as one single machine. The Board vide Circular No. 980/4/14-CX, dated 24-1-2014 has clarified that in the cases where the actual production of the machine because of some manufacturer operating the machine at the highest possible speed is more than the deemed production, no differential duty is to be charged. The dispute in this case has to be looked at on the basis of these principles. 8. The dispute in the present case is about PK-90 FFS Machine of duplex model supplied by PKIL, Vadodara. There is no dispute that it is a duplex machine in the sense that while only one laminate roll is fed into the machine with zip, two pouches are cut at a time and therefore, the speed of production of this machine is about two times the packing speed of simplex model of such machine. The point of dispute is as to whether this is to be treated as two track machine and hence it is to be treated a....