2008 (9) TMI 717 - AT - Central Excise

Summary

Issues involved: Determination of differential duty demand for a specific period and rejection of a refund claim for another period.

Differential Duty Demand Issue: The appeals were filed by the assessee against a demand of differential duty for the period 28-10-1999 to 27-12-1999. The main issue revolved around whether the clearances of goods from the appellant's depot during the material period should be considered as wholesale trade. The definition of 'place of removal' under Section 4 of the Central Excise Act was crucial, where the depot was acknowledged as a place of removal for excise duty payment. Duty of excise was chargeable based on the price at which goods were originally sold by the assessee to buyers in wholesale trade. The buyers, such as M/s. Kumaran Stores, M/s. Santhosh Book Stores, and M/s. Kamatchiamman Stores, purchased goods from the assessee's depot for retail sale, indicating purchases in wholesale trade. Consequently, the demand for differential duty for the specified period was upheld.

Refund Claim Rejection Issue: The second appeal was against the rejection of a refund claim for the period 30-9-1998 to 17-10-1998. The same principle of wholesale trade applied, and it was noted that the assessee had paid duty for this period based on the wholesale transactions. Therefore, the rejection of the refund claim for this period was deemed justified.

Operative Decision: The Appellate Tribunal CESTAT, CHENNAI dismissed Appeal No. E/1160/2001 related to the rejection of the refund claim. Additionally, Appeal No. E/652/2001 concerning the demand of differential duty and penalty was disposed of with a reduction of penalty to Rs. 5,000, considering the circumstances of the case. The order was pronounced in open court on 18-9-2008.