2008 (6) TMI 518 - AT - Central Excise

Merchant Overtime Charges (MOT) - Held that - there are two streams of decisions which are not in agreement with each other the disputed issue requires to be resolved by a Larger Bench - matter referred to Larger Bench.

Summary

Issues:
Dispute over payment of Merchant Overtime Charges (MOT) for services by Central Excise officers during working hours; Refund claim rejection; Commissioner (Appeals) decision favoring the appellants; Revenue's appeal against the Commissioner's decision; Conflict in Tribunal decisions necessitating resolution by a Larger Bench.

Analysis:
The appeal before the Appellate Tribunal CESTAT, Ahmedabad involves a dispute concerning the payment of Merchant Overtime Charges (MOT) for services provided by Central Excise officers during working hours. The charges were levied under Customs Regulations and the CBEC Excise Manual Supplementary Instructions. Initially, the respondents did not pay the charges for the period 1-10-2006 to 31-12-2006 but later paid Rs. 66,920/- under protest as directed by their Range Superintendent. Subsequently, they filed a refund claim on 29-1-2007, contending that they were not liable to pay MOT charges for the services rendered. The original Adjudicating Authority rejected the refund claim on 21-3-2007. However, on appeal, the Commissioner (Appeals) ruled in favor of the appellants, citing precedent decisions of the Tribunal and allowing the appeal. The Revenue has now appealed against this decision.

Upon hearing both sides, the presiding judge noted that the Commissioner (Appeals) relied on the Tribunal's decision in the case of M/s. Sigma Corporation (I) Ltd. v. CCE, New Delhi, which was further followed in subsequent cases. However, it was observed that the Tribunal did not agree with these decisions in the case of M/s. Naval Overseas Pvt. Ltd. v. CCE, Ahmedabad, which led to conflicting decisions within the Tribunal. The Tribunal, in a subsequent case, followed the decision in the case of M/s. Naval Overseas P. Ltd., wherein the Revenue's appeal was allowed. Given the conflicting decisions, the presiding judge concluded that the disputed issue required resolution by a Larger Bench. The Registry was directed to present the case before the Hon'ble President for the constitution of a Larger Bench to address the conflicting interpretations and reach a definitive conclusion on the matter.