2011 (4) TMI 1091 - AT - Central Excise

Extended period of limitation - Demand of duty with interest and equivalent amount of penalty on the appellant on the ground that in respect of the goods manufactured by them drawing, designing and development charges have not been included Held that - decision in the case of Jamshedpur vs. Tata Motors (2008 - TMI - 33518 - CESTAT KOLKATA) , applicable to the facts of the case and therefore extended period could not have been invoked, request made by the appellant for stay petition be allowed and appeal itself remanded on merits for favourable consideration, stay petition allowed and matter remanded to the Commissioner (Appeals) by setting aside the impugned order who shall proceed to decide the issue afresh without insisting on any further deposit from the appellant

Summary

Issues:
Calculation of duty liability based on drawing and design charges for goods manufactured for a specific company. Dismissal of appeal by Commissioner (Appeals) due to non-compliance with a stay order requiring deposit of 50% of the duty.

Analysis:
The case involves a demand for duty amounting to Rs.6,53,951/- with interest and an equivalent penalty imposed on the appellant for not including drawing, designing, and development charges in the goods manufactured for a particular company. The appellant argued that the duty payable would be much lower if the drawing and design charges were considered based on a previous decision where it was held that the extended period cannot be invoked if such charges are not included in the assessable value. The appellant requested the appeal to be remanded for a decision on merits, citing that the dismissal for non-compliance with the deposit requirement was unjustifiable.

The Department, on the other hand, contended that the value of clearance for drawing and design charges was correctly calculated and included in the show-cause notice. However, discrepancies were noted between the figures presented by the Department and the appellant, raising doubts about the accuracy of the calculations. The Tribunal found the decision cited by the appellant to be applicable to the case, concluding that the extended period could not have been invoked. As a result, the Tribunal allowed the stay petition, remanded the matter to the Commissioner (Appeals) for a fresh decision on merits without requiring any further deposit from the appellant, keeping all issues open for consideration.