2009 (10) TMI 821 - AT - Central Excise

Summary

Issues:
1. Waiver of total duty, penalties, and interests on confirmed demands.
2. Consideration of additional amounts received for sales to Advance Licence-Holders for levy of Central Excise Duty.
3. Applicability of Supreme Court decision post-amendment of Central Excise Act.
4. Time-barred demand for duty.
5. Financial hardship due to pre-deposit requirements.

Analysis:
1. The Applicant sought waiver of duty, penalties, and interests totaling Rs. 30,69,68,845.00 on confirmed demands arising from 11 Show Cause Notices. The demands were based on additional consideration received for sales to Advance Licence-Holders. The Revenue contended that such additional consideration is liable for Central Excise Duty under Section 4 of the Act.

2. The Applicant argued that the demands post-amendment of the Central Excise Act should not be based on the Supreme Court decision predating the amendment. The Applicant also claimed that the demands were time-barred for the period before the amendment. The Applicant started paying duty considering the additional consideration to avoid disputes.

3. The Revenue relied on the Supreme Court decision to support the levy of duty based on additional consideration. The amended Section 4 of the Central Excise Act includes the money value of additional consideration in the duty payable on goods. The reduction in the price of goods due to benefits like Advance Intermediate Licences is considered as additional consideration.

4. The Tribunal found that the benefit from Advance Intermediate Licences and the reduced transaction value of goods constituted additional consideration under the amended Section 4 of the Act. While total waiver of duty was not granted, the demand for the period before the amendment was deemed time-barred. The Applicant was directed to deposit Rs. 19.42 crores within 12 weeks, with the remaining amounts waived and recovery stayed during the Appeals.

5. In light of the financial hardship claim due to the pre-deposit requirement, the Tribunal balanced the interests of the Revenue and the Applicant by ordering a partial deposit and waiver of the remaining amounts. The compliance deadline was set for reporting on 12-1-2010, ensuring due process and monitoring of the case progress.