2005 (7) TMI 564 - AT - Central Excise

Summary

Issues:
Challenge against demand of Cess on Tea in blended and packed form under Section 25 of the Tea Act, 1953.

Analysis:
The appeals revolve around the challenge to a demand for Cess on Tea in blended and packed form under Section 25 of the Tea Act, 1953. The assessee had already paid Cess on tea at the garden stage, a fact acknowledged by the Revenue. The pivotal question was whether Cess is chargeable again on tea at any subsequent stage. The decision in the case of V.R. Industries v. Superintendent of Central Excise, Vijayawada, 2001 (133) E.L.T. 306 (A.P.) was cited, where it was held that packing or wrapping does not alter the nature or character of tea. Notably, under Section 25 of the Tea Act, 1953, Cess is imposed on tea produced in India. Since the appellants had already paid Cess on tea at the garden stage, they were not obligated to pay Cess again on tea in packed form. This conclusion was supported by the ruling of the Andhra Pradesh High Court. Furthermore, Circular No. 777/10/2004-CX dated 3-3-2004 clarified the position, exempting teas from Cess if it had already been paid at an earlier stage. The Board emphasized the need to regulate Cess collection in accordance with this amendment.

The Tribunal, in light of the above analysis, set aside the demand for Cess on tea in blended and packed form from the appellants. Consequently, the impugned orders were overturned, and the appeals were allowed. The decision was dictated and pronounced in open court, providing a clear resolution to the issue at hand.