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2013 (10) TMI 489 - AT - Central ExciseMRP Based duty u/s 4A or Transaction value u/s 4 on clearance of shoes - Effect of Amendment SWM Rule to the definition of retail packages and Rule 2A - Held that - Prior to the amendment of the Standard Weights and Measures (Packaged Commodities) Rule,1977, the clearances made to industrial consumers/institutional consumers were falling outside the purview of in view of the specific provisions contained - The Tribunal has interpreted the relevant provision, Rule 34 of the said Rules, Relying upon Maxim Adhesive Tapes Pvt. Ltd. vs. CCE, Daman 2013 (6) TMI 238 - CESTAT AHMEDABAD The provision of Sec.4A cannot be made applicable when the goods are cleared to industrial/institutional consumers and accordingly such clearances were held to be assessed under Section 4 of Central Excise Act, 1944 - Prima facie, it is a fact that the Rules have been amended from 13.01.2007, but the impact of the amendment needs detailed deliberation and analysis - the issue involved in the present case is a pure question of law and highly debatable one and apparently covered by a judgement of this Tribunal for pre-amendment era, the Applicant could able to make out a prima facie case for total waiver of pre-deposit of dues adjudged - all dues waived and its recovery stayed during pendency of the Appeal Stay granted.
Issues:
Waiver of pre-deposit of duty and penalty under Section 11AC of Central Excise Act, 1944 for the manufacture and clearance of shoes under Chapter 64 of CETA, 1985, specifically regarding the assessment under Section 4A or Section 4 of the Central Excise Act, 1944. Analysis: Issue 1: Waiver of Pre-Deposit of Duty and Penalty The Appellant sought waiver of pre-deposit of duty and penalty amounting to Rs.13,09,121/- imposed under Section 11AC of the Central Excise Act, 1944. The Appellant, engaged in manufacturing shoes falling under Chapter 64 of CETA, 1985, cleared Mines Safety Boots and Industrial Boots to collieries and industries after affixing MRP on each pair. The dispute arose when a demand notice alleged that the goods should be assessed under Section 4 instead of Section 4A of the Central Excise Act, 1944, resulting in a demand for differential duty. The Appellant argued that the goods were correctly assessed under Section 4A due to the requirement of affixing MRP during manufacture, even if later sold to industrial consumers. The issue was deemed a pure question of law, with conflicting views on the applicability of Rule 2A and the definition of retail packages under Rule 2(p) highlighted by the Appellant. Issue 2: Assessment under Section 4 or Section 4A The Revenue contended that post-amendment of the Standard Weights and Measures (Packaged Commodities) Rule, 1977, affixing MRP was not required for goods cleared to industrial/institutional consumers. Therefore, the Revenue argued for assessment under Section 4 of the Central Excise Act, 1944. However, the Tribunal noted that prior to the amendment, clearances to industrial/institutional consumers were outside the purview of Section 4A, as interpreted in the Maxim Adhesive Tapes case. The Tribunal found the issue to be a pure question of law and subject to detailed deliberation, especially considering the impact of the amendment. Given the debatable nature of the issue and the existence of a precedent judgment for the pre-amendment era, the Tribunal granted a waiver of pre-deposit and stayed the recovery of all dues adjudged during the pendency of the appeal. In conclusion, the Tribunal granted the waiver of pre-deposit of duty and penalty, staying the recovery of dues adjudged, based on the prima facie case presented by the Appellant regarding the correct assessment under Section 4A of the Central Excise Act, 1944 for the clearance of manufactured shoes to industrial consumers.
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