TaxTMI 
TaxTMI 
TaxTMI 
2025 (11) TMI 829
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....ted to incorporate the following changed name and address of the respondent in the appeal records for the purpose of disposal of the appeal:- "Commissioner of Central Goods Service Tax & Central Excise, Navi Mumbai Commissionerate, 16th Floor, Satra Plaza, Sector -19D, Palm Beach Road, Vashi, Navi Mumbai - 400 705". 3.1 Brief facts of the case, leading to this appeal, are summarized herein below: 3.2. The appellants herein is engaged inter alia, in the manufacturer of petroleum products by refining of crude petroleum and marketing of various finished products viz., High-Speed Diesel (HSD), Motor Sprit (MS), Superior Kerosene Oil (SKO), Aviation Turbine Fuel (ATF), Lube Oil etc. by classifying the aforesaid products under Chapter 25, 27 of the First Schedule to the Central Excise Tariff Act, 1985. The appellants are registered taxpayers holding Central Excise Registration No. AAACH1118BXM010 for manufacture of aforesaid excisable goods on payment appropriate Central Excise duty of and for compliance with Central Excise statue. 3.3 The excisable goods viz., HSD, MS and SKO manufactured at Mahul refinery are tr....
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.... said SCN dated 28.07.2015, learned Joint Commissioner of Central Excise, upon examination of the various issues had confirmed the duty demands raised in the SCN and imposed penalty for equal amount of duty demanded under Section 11AC ibid read with Rule 25 ibid vide order dated 31.03.2016. Being aggrieved with the order passed by original authority, the appellants had filed an appeal before the Commissioner of Central Excise (Appeals) who in deciding the case, has upheld the order passed by the Original authority and rejected the appeal filed by the appellants vide the impugned order dated 21.09.2016. Feeling aggrieved with the impugned order dated 21.09.2016, the appellants have preferred this appeal before the Tribunal. 4.1 Learned Advocate appearing for the appellants had submitted that the activity of mixing of SKO with MS or HSD is happening because of technical necessity, under such activity does not amount to manufacture in terms of Section 2(f) of the Central Excise Act, 1944 and hence the demand of duty is not sustainable. Further, the appellants though cleared the SKO for the purpose of PDS availing the duty exemption benefit, for the quantum of intermixed....
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....filed by the appellants cannot be entertained. 6. Heard both sides and perused the records of the case. We have also examined the submissions advanced by learned Advocate appearing for the appellant and the learned Authorized Representative of the Department. Further, we have also perused the additional written submissions in the form of paper books submitted by both sides along with citation of case laws which both sides have mentioned in support of their case. 7. The issue involved in this appeal is to examine whether the appellants are liable to pay Central Excise duty on intermingled SKO with HSD/MS, at the higher of the two duties i.e., duty payable on a SKO, not used for intended purpose of PDS and duty payable on surge/gain in HSD/MS, during the disputed of July, 2014 to March, 2015; and whether the adjudged demands confirmed in the impugned order is legally sustainable. 8.1 In order to address the above issue, we would like to refer the relevant legal provisions contained in Central Excise Act, 1944 and Central Excise Rules, 2002 as it existed during the disputed period. "Central Excise Act, 1944 Chapter II Levy and Collection of Duty ....
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....moval of doubts, it is hereby declared that the price-cum-duty of the excisable goods sold by the assessee shall be the price actually paid to him for the goods sold and the money value of the additional consideration, if any, flowing directly or indirectly from the buyer to the assessee in connection with the sale of such goods, and such pricecum-duty, excluding sales tax and other taxes, if any, actually paid, shall be deemed to include the duty payable on such goods. (2) The provisions of this section shall not apply in respect of any excisable goods for which a tariff value has been fixed under sub-section (2) of section 3. xxx xxx xxx xxx 3(c) "place of removal" means- (i) a factory or any other place or premises of production or manufacture of the excisable goods; (ii) a warehouse or any other place or premises wherein the excisable goods have been permitted to be deposited without payment of duty; (iii) a depot, premises of a consignment agent or any other place or premises from where the excisable goods are to be sold after th....
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....rovision for charging duty of excise at different rates on the same excisable goods. 8.3 In the present case, the three distinct products, during the transportation of which the intermixed SKO occurs and on which there is a dispute on the determination of appropriate central excise duty, are High-Speed Diesel (HSD), Motor Sprit (MS), Superior Kerosene Oil (SKO). The tariff classification of the above products under the First schedule to the Central Excise Tariff Act are as follows: "CHAPTER 27 MINERAL FUELS, MINERAL OILS AND PRODUCTS OF THEIR DISTILLATION; BITUMINOUS SUBSTANCES; MINERAL WAXES Notes : xxx xxx xxx xxx Sub-heading Notes : xxx xxx xxx xxx Supplementary Note : In this Chapter, the following expressions have the meanings hereby assigned to them : (a) "motor spirit" means any hydrocarbon oil (excluding crude mineral oil) which has its flash point below 25°C and which either by itself or in admixtu....
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....nbsp; xxx xxx 2710 19 -- Other : 2710 19 10 --- Superior kerosene oil (SKO) 2710 19 20 --- Aviation turbine fuel (ATF) 2710 19 30 --- High speed diesel (HSD) xxx xxx xxx xxx From the classification of the impugned goods viz., SKO, HSD, MS provided under the First Schedule, it clearly emerges that each of the above goods are distinctly classified under 2710 1910 (SKO), 2710 1930 (HSD) and 2710 1211, 2710 1212, 2710 1213, 2710 1219 (MS). Further, in order to qualify commodity as MS or HSD, the relevant supplementary note has to be fulfilled in terms of technical specifications and BIS standards. The records placed in the case file do not provide any documentary evidence to show that intermix of SKO with MS/HSD have the characteristics of MS or HSD, in....
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....have correctly applied the price of respective goods cleared from the factory at the time of removal. Therefore, we do not find any support of any statutory provisions in the Board Circular. The Hon'ble Supreme Court has time and again, held that the Board Circular cannot vitiate the law or the Board Circular cannot be issued contrary to the statutory provisions. We refer some of the judgements on this issue : a) 2008 (229) ELT 641 (SC) - Sindur Micro Circuits Limited Vs. CCE, Belgaum. b) 2009 (235) ELT 385 (SC) - Atul Commodities Pvt. Ltd. Vs. CCE, Cochin. c) 2003 (156) ELT 819 (Bom) - NarndraUdeshi Vs. UOI d) 2015 (326) ELT 26 (SC) - DGFT Vs. Kanak Exports. 9. In view of the above judgements, it is clear that the Board can only clarify the existing law but cannot create law by itself. Therefore, the above Board Circular dated 22.04.2002 having without having support of any Act or Rule, is not binding on the assessee. 10. As regards the issue that after removal of goods, intermixing of SKO with MS/HSD amounts to manufacture, we find that there is no charge in the Show Cause Notice that the ac....