2006 (6) TMI 339 - AT - Central Excise

Summary

Issues:
Application to dispense with the condition of pre-deposit of duty amount and personal penalty.

Analysis:
The appellants, engaged in manufacturing insecticides and pesticides, were assessed duty based on maximum retail price under Section 4A of the Central Excise Act from 1-3-2003. However, discrepancies were found in their sale invoices from March 2003 to June 2004, where they cleared products to another company without applying Section 4A for duty calculation. The Revenue contended that Section 4A should apply even for goods distributed for free along with other products. The Commissioner's order initiated proceedings to recover the differential duty.

The Tribunal referred to previous cases to determine the applicability of Section 4A. In the Nestle India Ltd. case, it was held that Section 4A applies even for goods distributed for free if they are required to be printed with MRP. However, the G.S. Enterprises case distinguished this, stating that goods without MRP printing are not covered. The appellants argued that their products lacked MRP printing, aligning with the G.S. Enterprises decision.

Another case, CCE Ludhiana v. Pepsi Foods Ltd., differentiated from Nestle India Ltd., holding that free goods should be assessed under Section 4, not Section 4A. The Tribunal acknowledged the conflicting decisions and granted an unconditional stay, citing settled law that contrary decisions warrant such action. They appreciated the distinction made by the appellants regarding MRP printing, similar to the G.S. Enterprises case.

The Tribunal allowed the stay petition unconditionally and scheduled the appeal for further resolution due to the conflicting judgments. They aimed to resolve the disputed issues promptly and set a date for the appeal hearing.

In conclusion, the Tribunal granted an unconditional stay, considering the conflicting judgments on the disputed issue and the need for further resolution before a Larger Bench.