2013 (11) TMI 778 - AT - Central Excise

Determination of assessable value of made up articles of textiles as per Rule 7 and rule 11 of central excise valuation rules, 2000 - Data submitted for justifying the total retailing expenses is around 44% - Only 16.34% has allowed without any justification Held that - Commissioner has only recalculated the liability instead of considering their request of deduction of retailing expenses which is around 40-44% - initially they have submitted the data whereby the retailing expenditure was computed at 46%, but after detailed calculation, it has come down to 44%, duly supported by Chartered Accountant s Certificate. The figure was given on the basis of the retailing expenditure incurred by the Applicant from all their retail outlets, including Kolkata - a mechanism has to be adopted for determining the retailing expenses pertaining to Kolkata only - all data relating to the determination of the retailing expenditure would be submitted by them Matter remanded back for the fresh adjudication - Assessee directed to submit Rupees one lakh and twenty five thousand as pre-deposit upon such submission rest of the duty to be waived till the disposal Partial stay granted.

Issues:
1. Determination of assessable value of made up articles of textiles.
2. Request for waiver of pre-deposit of duty.
3. Discrepancies in data submitted by the applicant.
4. Need for remand to lower authorities for verification of data.
5. Timeframe for disposal of the case.

Analysis:

Issue 1: Determination of assessable value of made up articles of textiles
The Tribunal had previously remanded the matter for re-determination of the assessable value of made up articles of textiles, emphasizing that assessment for excise purposes cannot be based solely on retail sale price due to the unique circumstances of the case where no wholesale transactions were involved. The Tribunal directed that the assessment should be made under Rule 11 read with Rule 7, allowing a reasonable margin of deduction from the retail sale price based on costing data provided by the appellants or industry averages. The Tribunal set aside the impugned orders and remanded the matter to the original authority for fresh determination after considering the costing data.

Issue 2: Request for waiver of pre-deposit of duty
The appellant sought waiver of pre-deposit of duty amounting to Rs.4.93 Lakhs. However, the Tribunal directed the appellant to deposit Rs.1.25 Lakhs within eight weeks and report compliance directly to the adjudicating authority. The matter was remanded to the adjudicating authority for reconsideration after the deposit was made, with all issues kept open for further examination.

Issue 3: Discrepancies in data submitted by the applicant
There were discrepancies in the data submitted by the applicant, particularly regarding the calculation of retailing expenses. The adjudicating authority had allowed a deduction of 16.34% from the assessable value, while the appellant claimed a deduction of 44% supported by a Chartered Accountant's Certificate. The Tribunal noted the need for accurate data submission and directed the appellant to provide all relevant data specifically relating to retailing expenses in Kolkata for proper assessment.

Issue 4: Need for remand to lower authorities for verification of data
The Revenue pointed out inconsistencies in the data submitted by the appellant, highlighting a calculation mistake and differing MRP figures. The Revenue suggested remanding the matter to lower authorities for verification of all data provided by the appellant to ensure accuracy before making a final determination. The Tribunal agreed with the Revenue's stance on the need for verification before remanding the matter.

Issue 5: Timeframe for disposal of the case
Considering the prolonged duration of the case since 2003, the appellant requested a fixed timeframe for early disposal. The Revenue had no objection, and the Tribunal directed the adjudicating authority to adjudicate the matter afresh within three months from the date of reporting compliance and submission of relevant data by the appellant, whichever is later.

In conclusion, the Tribunal addressed the issues of determining the assessable value, pre-deposit of duty, discrepancies in data submission, the need for verification, and set a timeframe for the case's disposal, ensuring a fair and thorough reconsideration of the matter.

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