TaxTMI 
TaxTMI 
2025 (4) TMI 1182
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....rty under Section 4 of the Central Excise Act, 1944. (ii) I confirm the demand oil Central Excise duty amounting t5 Ps.23,30,995/- (Rupees Twenty three Lakh Ninety Thousand Nine Hundred Ninety Five only) on the assorted leaf springs cleared clandestinely during he period January, 2014 to August, 2015 under the provision of Section 11A(4) of the Central Excise Act, 1944 read with Section 174 of the CGST Act, 2017 (iii) I also confirm the demand pf Central Excise duty amounting to Rs. 4,33,895/- (Rupees Four Lakh Thirty |Three thousand Eight Hundred Ninety Five only) involved on the short found stock of 21826 Kgs of Flat Bars and 4200 pieces of Spring leaf assembly under the provision of Section 11A (4) of the Central Excise Act, 1944 read with section 174 of the CGST Act, 2017. (iv) I order for recovery of interest on delayed payment of duty from the party under Section 11AA of the Central Excise Act, 1944 till the payment of duty so confirmed read with Section 174 of the CGST Act, 2017 (v) I also impose a penalty of is. 28,24,890/- (Rupees Twenty Eight Lakh Twenty Four Thousand Eight Hundred Ninety only) upon the party under Section 11 AC of the ....
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....ined. d) The penalty under the provisions of Section 11AC of the Central Excise Act, 1944 read with Rule 25 of the Central| Excise Rules,2002 should not be imposed upon them for the reasons as discussed above. 2.5 The show cause notice was adjudicated as per the order in original referred in para 1 above. 2.6 Both Appellant and Revenue filed the appeal before the Commissioner. Revenue challenged the valuation of the finished goods which upheld application of Section 4 instead of Section 4A as proposed in show cause notice. Appellant challenged the confirmation of demand on the shortages and clandestine clearances along with interest and penalty. 2.7 Appeal of Revenue was dismissed by the impugned order. Appeal of Appellant was partly allowed to the extent of setting aside the demand on shortages of raw material and associated penalties. 2.8 Aggrieved by the impugned order both Appellant and Revenue have filed these appeals. 2.9 Appellant has filed cross objections in the appeal of Revenue. 3.1 We have heard Shri Nishant Mishra, advocate for the Appellant and Shri A K Choudhary, Authorized Representative for the Revenue. 3.2 Arguing for the Appellant le....
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...., on each removal of the goods, such value shall (a) in a case where the goods are sold by the assessee, for delivery at the time and place of the removal, the assessee and the buyer of the goods are not related and the price is the sole consideration for the sale, be the transaction value; (b) in any other case, including the case where the goods are not sold, be the value determined in such manner as may be prescribed Section 4A:- Valuation of excisable goods with reference to retail sale price- (1) The Central Government may, by notification in the Official Gazette, specify any goods, in relation to which it is required, under the provisions of the Legal It IS Metrology Act, 2009 (1 of 2010) or the rules made thereunder or under any other law for the time being in force, to declare on the package thereof the retail sale price of such goods to which the provisions of sub-section (2) shall apply. (2) Where the goods specified under sub section (1) are excisable goods and are chargeable to duty of excise with reference to the value, then, notwithstanding of anything contained in Section 4, such value shall be deemed to be the re....
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....obiles which are in the nature of Packaged Commodity and mandatorily bear retail sale price on the package in terms of Legal Metrology Act or the Rules made thereunder Further, the Apex Court in the case of Jayanti Food Processing (P) Ltd, vs. CCE Rajasthan (2007) 215 ELT 327 has held that the following condition are pre-requisite to apply the provisions of the Section 4A of the Central Excise Act, 1944 (i) The goods should be excisable goods; (ii) They should be such as are sold in the package; (iii) There should be requirement in the SWM Act or the Rules made thereunder or any other law to declare the price of such goods relating to their retail price on the package; (iv) The Central Government must have specified such goods by notification in the Official Gazette; If any of these conditions are not fulfilled in respect of the goods In question, then provisions of Section 4A shall not be applicable and 'assessment of duty' would be under Section 4 of the Act. In the instant case, condition (i) above is not satisfied in as-much as the Assorted leafs of Spring is not cleared in the packaged form rather it is cleared in bare ....
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....e do not find any merits in the appeal filed by Revenue in the present proceedings. Revenue authorities do not have discretion to pick and chose the proceedings for filing the appeal, when they have accepted the order on the same issue earlier. Even otherwise the both the authorities have concluded that the goods in the form in which they cleared do not qualify to be cleared in the packaged form for which the provisions of Standard of Weight and Measures Act and Rules made thereunder will be applicable. That being so, in view of the decision of the Hon'ble Supreme Court in case of Jayanti Food Processing (P) Ltd, valuation will have to be done as per Section 4 of the Central Excise Act, 1944 and not under Section 4A ibid. The finding of fact and the application of the case law in terms of the referred decision of Hon'ble Apex Court do not call for any interference and the appeal filed by the Revenue is without any merits. 4.5 In respect of the other issues impugned order records findings as follows: "8. Regarding demand of duty amounting to Rs 2390995/= on account of clandestine removai of finisked goods, it is apparent from the record that the same has been made on the....
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....ed under Section 14 of the Central Excise Act, 1944 stated that in the order slips, number and type of the spring leaf is mentioned and spring leaf as mentioned in the order slips have been sold by them through their dealers at the price shown in the price list. Order slips are maintained at the time of dispatch of the goods. Amount mentioned in the invoices is received through cheque, whereas, differential amount i.e. difference of the amount as shown in the invoices and as calculated on the basis of the MRP, is received by them in cash. MRP of the spring leaf assorted and the spring leaf assembly is not changed and remained same, however, percentage of discount varied from time to time and discount percentage depends upon cost of raw materials; he also admitted that in some cases, leaf spring assorted and leaf spring assembly which were mentioned in the order slips were cleared by them without payment of due Central Excise duty. The charts prepared by the officers on the basis of the resumed order slips were shown to him and on perusal of the same he admitted that the charts have been prepared correctly and in token of the agreement he put his dated signature on the charts. He al....
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....AIR 1974 SC699 held in that all the parts, of a recorded statement of an accused are not entitled to equal credit. An inculpatory, part of the statement could be accepted even though the exculpatory part, of the statement of the accused was rejected. Where the inculpatory part of the statement of the accused is distinct and severable from the exculpatory part, if the court finds the exculpatory parts to be inherently improbable, the other part of the statement which implicates the accused and which the court sees no reason to disbelieve, could be accepted In the case of Union of India Versus Anil Chanana as reported in 2006(10) LCX 0082 equivalent to 2007 (207) ELT 0351 (Del.) The Hon'ble High Court Deciding the: Writ Petition(Civil) No. 12912 of 2006 on 17.10.2006 held as under "As long as an applicant admits that he has committed an offence, of which compounding is sought, he has already fulfilled the requirement of making a full and true disclosure." In the number of cases the various Tribunals has held as under: Statement - Retraction of allegation that statement obtained under duress, threat etc made only in reply to the show cause notic....
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....ed in the order slips also contained clearances clandestinely made by them and clearances accounted by them in invoices, hence it is clear to me that where no corresponding invoice has been issued against an order slip. The goods were clandestinely cleared without payment of duty Accordingly, I come to the conclusion that party has been indulged in recording lesser production in statutory records than that of the actual production done by them and thereby evading central excise duty on such unrecorded suppressed production cleared clandestinely without cover of excise invoice. Since the party was not able to provide the item-wise details of goods cleared by them through invoices, the differential duty has been calculated on the basis of total monthly clearances reflected in the order slips and total monthly clearances calculated on item-wise clearances provided by the party. Accordingly, the following chart shows the details of the duty calculated by the party on the monthly basis for the clearances made on invoices, which were accounted for by them. Further, the clearances as reflected in the order slips include clearances clandestinely made by them as well as clearances ....
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....h Thus, as can be seen from the above table that the party cleared clandestinely assorted leaf spring valued at Rs.1,92,64,306/- during the period January, 2014 to August, 2015 as per order slips found by the officers in the factory of the party on which total central excise duty payable comes to Rs.23,90,995/- which is liable to be demandable from the party along with interest under the provisions of Section 11A (4) of the Central Excise Act, 1944 and Section 11AA of the Act ibid respectively. Further, during the physical stock verification of the finished gods as well as raw materials available in the factory premises of the party, the officers had detected shortage of 21826 Kgs of Flat Bars (raw material) valued at Rs 8,73,040/- involving Central Excise duty Rs. 1,09,130/- and shortage of 4200 pieces of Spring leaf assembly valued at Rs. 25,98,120/- involving Central Excise Duty amounting to Rs 3,24,765/- have gone through the panchnama and observed that the entire proceedings of physical stock verification were done before two independent witnesses and Shri Ashu Pandey, authorised representative of the Party and they had put their dated signature on the Panchn....
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.... invoices is higher than the figure indicated in the order sheet the differential figure of number of assorted leaf springs cleared clandestinely is shown as '0' (Zero). In the months where figure of number of leaf springs as per order sheet is higher than the number in the invoice the differential is alleged to be cleared clandestinely. No explanation is given for adopting such an approach. It is possible that the number of assorted leaf spring which are found in excess in one month get cleared in subsequent month or vice versa. We redraw the first five columns of the table from the order in original to point out the obvious : Month As per invoice No. of spring leaf assorted Cleared As per order slip Difference In Nos. No. of spring leaf assorted Assessable value as per Section 4 of C. Ex. Act, 1944 (in Rs.) 1 2 3 4 5=4-2 January 2014 10477 2991617 1218 0 February 2014 10126 2713442 0 0 March 2014 13113 3060158 259 0 April 2014 9860 2774928 4129 0 May 2014 16364 3579925 1178 0 June 2....
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....against the application of Section 4A for determination of the value of assorted leaf springs found excess. This order as noted in order in original has been accepted by the concerned Revenue authorities and no appeal as filed. 4.10 Interestingly on the basis of the statement of the Shri Ashu Pandey Authorized Signatory of the Appellant recorded on 23.01.2018 and accepted by the proprietor in his statement on 04.04.2018, the present show cause notice dated 20.04.2018 was issued to Appellant seeking to value the alleged clandestinely cleared goods again in terms of Section 4A of Central Excise Act, 1944. The date of Show Cause Notice is nearly after a month of order in appeal dated 16.03.2018 which has held against application of Section 4A ibid. The show cause did not proposed to value the said goods under Section 4 of the Central Excise Act, 1944. Adjudicating authority as well as Commissioner (Appeal) has in the impugned order have held against the application of Section 4A in line with the order in appeal dated 16.03.2018. The formula adopted by the adjudicating authority for valuation under Section 4 which is only a mathematical exercise has no basis in law. Thus computation....