TaxTMI 
TaxTMI 
2024 (4) TMI 324
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....nting or fitting of structures or equipment on the chassis falling under Chapter heading 8706 amounts to manufacture of a motor vehicle. Pursuant to audit of their records, it was alleged that the appellant had received 103 numbers of duty paid chassis during December 2006 to March 2008 from M/s.ALL for building bus bodies on the said chassis; availed cenvat credit on the duty paid chassis and after building the body on the same cleared the Vehicle to M/s. ALL on payment of duty on the aggregate value of the chassis and cost of body building. It is alleged that the appellant had cleared such bus bodies as per entry Sl.No.41(1)(ii) of Notification No.6/2006-CE dated 01/03/2006 but availed cenvat credit on the chassis in violation of condition 10 appended to the said Notification and also utilized the same towards payment of excise duty on the said bus bodies cleared to M/s. ALL, show-cause notice was issued to them on 03/04/2009 proposing denial of cenvat credit availed and recovery of the differential central excise duty of Rs.9,51,837/- on the assessable value as per Rule 10A of the Central Excise valuation Rules, 2000 along with interest and penalty. Later corrigendum / addendum ....
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..... 3.1. Assailing the impugned order, the learned advocate for the appellant has submitted that in response to the audit observation, they have submitted before the Department that they did not opt for the benefit of Notification No.6/2006-CE dated 01/03/2006 but assessed and paid duty on the body build vehicle as per applicable provision of law. In spite of the said submissions, from the commencement of the proceedings after audit of their records, the learned Commissioner has held otherwise. They have submitted that payment of duty as per the provisions of law without resorting to concessional payment of duty as envisaged under Sl.No.41(1)(ii) of Notification No.6/2006-CE cannot result into violation of the condition no. 10 attached thereto. This aspect has never been appreciated by the Department. Also, in the impugned order, it has not been appreciated that the appellant had included the value of chassis (supplied free of cost by the customer) and paid duty at normal rate on the assessable value being aggregate value of chassis and body building even though in the exemption Notification the value of the chassis is not to be included in arriving at the assessable value of the ....
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....lant has not opted for the same. It is submitted that the manner in which the appellant has assessed and discharged the duty by availing the benefit of cenvat credit is as per the principle laid down by the Hon'ble Supreme Court in the case of Ujagar Prints Vs. UOI [1988(38) ELT 535 (SC)]; Burn Standard Co. Ltd. Vs. UOI [1992(60) ELT 671 (SC)] and in Texmaco Ltd. Vs. CCE [1995(77) ELT 501 (SC)]. Therefore, invocation of extended period in confirming the demand alleging suppression of fact is unsustainable. Further they have submitted that imposition of penalty under Section 11AC is also not justified as there is no mens rea or culpable mental state and also there is no violation of law with intent to evade payment of duty. 4. Learned AR for the Revenue reiterated the findings of the learned Commissioner. He has submitted that the appellant had wrongly availed the benefit of Notification No.6/2006-CE dated 01/03/2006 without reversing the cenvat credit availed on the duty paid chassis supplied free of cost to the appellant for body building. 5. Heard both sides and perused the records. 6. The issues involved in the present case for determination are: whether: (i) the appell....
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....urer of the chassis. Explanation.-For the purposes of entries (1) and (2), the value of vehicle shall be the value of the vehicle excluding the value of the chassis used in such vehicle. 24% 16% 24% 16% 24% 16% Condition No.10. : If no credit of duty paid on the chassis falling under heading 8706 has been taken under rule 3 or rule 13 of the CENVAT Credit Rules, 2004. 11. From the records, we find that from the very beginning of the proceeding, in their reply to the internal audit, the appellants have categorically submitted that they have not opted for the exemption under Notification No.6/2006-CE dated 01.3.2006, hence, not required to comply with the conditions prescribed under the said notification. They have informed that by availing cenvat credit on the duty paid chassis and after undertaking the activity of body building on the Chassis, which amounts to manufacture, they had cleared the Vehicle applying the normal tariff rate as applicable from time to time. But the Department continued to allege that the appellant had violated the condition No.10 appended to the said notification by availing cenvat credit on the dut....