2008 (11) TMI 452 - AT - Central Excise

Summary

Issues involved: Calculation of excise duty, submission of cost certificate in CAS-4 format, time-barred demand, penalty on director.

The judgment by the Appellate Tribunal CESTAT, AHMEDABAD involved the appellant clearing excisable goods to their sister concern without submitting a cost certificate in CAS-4 format from a cost accountant. The Revenue contended that a profit margin should be added to the value adopted by the appellants, resulting in a demand for duty and penalties.

Regarding the submission of the cost sheet in CAS-4 format, the appellant argued that they had submitted a cost sheet prepared by themselves but it was not accepted by the department as it was not signed by a cost accountant. The appellant also claimed that the demand was time-barred, as the duty paid could be credited by the sister unit. The appellant further argued that the duty was paid based on the value of comparable goods sold to independent buyers, which was higher than the cost of production plus profit. The appellant also contested the penalty on the director, stating that no goods were liable for confiscation.

The Tribunal found that the demand was indeed time-barred, citing previous decisions and noting that the duty was paid using the value of comparable goods, even though it may not align with the new Section 4 provisions. The Tribunal acknowledged that the appellant had no intention to evade duty, especially since the comparable price adopted was higher than the CAS-4 value. Despite the rejection of the cost sheet for not being certified by a cost accountant, the Tribunal accepted the appellant's argument that the comparable price was higher than their calculated price, indicating no case for the Revenue on limitation. The demand period was from 2002 to 2004, while the show cause notice was issued in 2006, leading to the appeals being allowed with consequential relief to the appellants.