TaxTMI 
TaxTMI 
2018 (12) TMI 2020
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.... under Section 11AC of the Central Excise Act, 1944 and applicable interest for the period from December 2003 to March 2008. 2. Briefly stated, the facts of the case are that the assessee is engaged in the business of manufacture of iron and steel items on which central excise duty is being paid. In the impugned period, it was observed that the assessee, apart from selling goods to independent buyers, had also cleared goods for erection of structural items on which it paid central excise duty on the basis of price applicable in case of goods cleared to unrelated buyers which is on record. Show Cause Notice dated 18.12.2008 was initially issued by invoking extended period of limitation to raise demand of central excise duty of Rs. 98,03,109....
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....ected to unrelated buyers, no further duty was payable. Wherever they had paid duty less than the duty payable on the basis of Rule 4, the differential duty was held to be liable which amounted to Rs. 11,99,970/-. On the basis of said observations, the Ld. Commissioner confirmed the duty demand of Rs. 11,99,970/- and imposed equal penalty on the ground that there was suppression on the part of the assessee. The remaining duty amount proposed in the Show Cause Notice was dropped. 3. Shri Ravi Raghavan, Ld. Advocate, appearing on behalf of the appellant submitted that the Show Cause Notice (SCN) proposed demand of excise duty only on the basis of Rule 8 of the Valuation Rules. No reference or proposal was made to Rule 4 of the said Rules to ....
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....be available as CENVAT Credit and hence, the situation would be completely revenue neutral and therefore, imposition of penalty is not justified. 4. The Ld. Departmental Representative (DR) submitted that the Ld. Commissioner while accepting the legal principles as laid down by the Larger Bench of the Tribunal in Ispat Industries Ltd (Supra), has already set aside the demand under Rule 8, but however, the assessee cannot be absolved from the duty liability under Rule 4 of the Valuation Rules as has been held by the Larger Bench in the above referred case. Accordingly, the Ld. D.R. supported the findings made by the Ld. Commissioner and prayed to confirm the duty demand as ascertained in the adjudication order. 5. Heard both sides and peru....
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....ssessee as permissible under the law. Further, the Apex Court in Gas Authority of India Ltd (Supra) has also held that the Show Cause Notice is a foundation of a demand under Central Excise Act and in case the adjudication order proceeds in the line contrary to the Show Cause Notice, the same deserves to be quashed. Moreover, in the very issue pertaining to valuation of excisable goods, the Hon'ble Supreme Court in CCE vs. Ballarpur Industries (Supra), while setting aside the first Show Cause Notice which was barred by limitation, categorically observed in para 21 of its order that since Rule 7 of the Valuation Rules was not invoked in the second and third Show Cause Notices impugned therein, demand could not sustain for the reason that the....