2012 (6) TMI 669 - AT - Central Excise

Waiver of pre-deposit - Marketability - Printing of registers, accounts books, various forms, order books, receipt books and similar articles - goods in question are printed for the use of Central Railway only Held that - Goods are not ordinarily capable of bought and sold in the market as these are basically made to run the Railways administration and to maintain the internal records of the Railway. Therefore, the demand is not sustainable - No evidence on record to show that the goods in question which are printed by the Central Railway Printing Press are capable on being bought and sold in the market - Pre-deposit of duty, interest and penalty is waived - Petition is allowed

Summary

Issues Involved: Application for waiver of pre-deposit of duty, interest, and penalty regarding classification of goods under Chapter 48 of Central Excise Tariff Act, 1985 for printing activities by Central Railway Printing Press.

Analysis:
1. Classification of Goods and Demand: The applicant, Central Railway Printing Press, sought waiver of pre-deposit of duty, interest, and penalty amounting to Rs.2,17,56,480/-, contending that the goods printed for Central Railway's internal use were not marketable and hence not liable for duty. The demand was based on the classification of goods under Chapter 48 of the Central Excise Tariff Act, 1985, following the withdrawal of an exemption through notification no. 10/2003 dated 01.03.2003.

2. Applicant's Contentions: The applicant argued that the goods printed, such as forms for ticket reservations and internal records, were specifically for Central Railway's operational needs and not intended for sale in the market. The Ld. Sr. Advocate highlighted that the goods were not commercially sold but essential for Railway administration, thus challenging the sustainability of the demand.

3. Revenue's Stand and Legal Precedent: The Revenue relied on the decision of the Hon'ble Supreme Court in the case of Nicholas Piramal India Ltd. Vs. CCE, Mumbai, emphasizing that if the goods were not printed by Central Railway, they would have been outsourced, making the printer liable for duty. The Revenue argued that even if goods were sold to a single buyer, they could still be considered marketable, citing the Supreme Court's stance on marketability in a similar case.

4. Judicial Analysis and Decision: The Tribunal examined the nature of goods printed by Central Railway Printing Press and the absence of evidence indicating their marketability. Citing the Supreme Court's ruling on marketability, the Tribunal found that the goods were not shown to be capable of being bought and sold in the market. Consequently, the Tribunal held that the applicant had a strong case, leading to the waiver of pre-deposit of duty, interest, and penalty, with a stay on recovery during the appeal's pendency.

5. Conclusion: The Tribunal allowed the stay petition, emphasizing the lack of proof regarding the marketability of the goods printed by Central Railway Printing Press for internal Railway use. The decision highlighted the importance of demonstrating marketability for goods to be subject to duty, ultimately favoring the applicant's argument and granting the requested waiver and stay on recovery.