2014 (1) TMI 219 - AT - Central Excise

Under valuation of Aviation Turbine Fuel - Waiver of Pre-deposit Held that - The provisions of Rule 7 of Central Excise Valuation Rules very clearly indicate that the excise duty is to be discharged on the excisable goods from where they are stored, after their clearance, from the place of removal - The appellant has not made out prima facie case in their favour appellant has already deposited an amount of Rs. 6.56 Crores - Appellant is directed to deposit Rupees two crores and fifty lakhs as pre-deposits upon such submission rest of the duty to be stayed till the disposal Partial stay granted.

Summary

Issues:
1. Stay petition for waiver of pre-deposit of confirmed duty, interest, penalty, and fine.
2. Correct valuation of consignments under Rule 7 of Central Excise Valuation Rules.
3. Appellant's case on limitation and intent to evade duty.
4. Departmental submission on duty liability and appellant's knowledge of the law.
5. Consideration of merits, limitation, and pre-deposit waiver.

Analysis:
1. The appellant filed a stay petition seeking a waiver of pre-deposit of confirmed duty, interest, penalty, and fine amounting to Rs. 17.20.96,803/-. The duty was confirmed due to under-valuation of Aviation Turbine Fuel (ATF) cleared from the bulk terminal to fuel stations where it was sold at a higher price.

2. The appellant argued that Rule 7 of the Central Excise Valuation Rules was correctly applied, valuing consignments at the bulk terminal as the place of removal. However, the Tribunal found that even if the bulk terminal was considered the place of removal, the value adopted at the Aviation Fuel Stations should be considered for excise duty discharge, leading to a rejection of the appellant's merit case.

3. Regarding limitation and intent to evade duty, the Tribunal recognized this as a mixed question of law and facts requiring detailed examination during the final appeal disposal. The appellant, being a public sector undertaking, claimed innocence of misstatement or suppression of facts with intent to evade duty.

4. The departmental representative emphasized the appellant's responsibility as a public sector entity in an organized sector, arguing that they should have better knowledge of the law. The representative insisted on the full deposit of duty liability by the appellant.

5. After considering submissions and records, the Tribunal concluded that the appellant failed to establish a case for complete waiver of pre-deposit. Acknowledging the appellant's previous deposit of Rs. 6.56 Crores, the Tribunal directed a further deposit of Rs. 2,50,00,000/- within eight weeks. The recovery of the remaining balance was stayed pending the appeal's disposal, subject to compliance verification by the Deputy Registrar.

This detailed analysis of the judgment addresses the key issues raised in the case, including valuation rules, limitation, intent to evade duty, and the Tribunal's decision on the waiver of pre-deposit.