2011 (11) TMI 562 - AT - Central Excise

Waiver of pre-deposit of duty - The demand is confirmed after taking into consideration the advance received by the applicants and the same has not been adjusted at the time of clearance of goods in the final bill and the applicants are giving discount up to 35% to such customers - Held that - Assessable value of the goods is suppressed with intent to evade payment of duty in respect of the goods cleared to the customers who have given advance deposits particularly when those advance deposits are not adjusted in the final bills. We find that the applicant has already deposited an amount of Rs. 27,278/-. Keeping in view the facts and circumstances of the case, we find that the applicant has not made out any case for waiver of pre-deposit of duty. The applicants are directed to deposit the remaining amount of duty within a period of four weeks from the receipt of this order - Decided against assessee.

Issues: Request to decide on merits, waiver of pre-deposit of duty, suppression of assessable value, discount given to customers, compliance deadline

In this judgment, the Appellate Tribunal CESTAT MUMBAI considered a request by the Appellant to decide on merits, which was made through a letter dated 22-11-2011. The Appellant had filed applications seeking waiver of pre-deposit of duty amounting to Rs. 54,355/- and Rs. 17,904/-, along with interest and penalties. The Tribunal noted that a common issue was involved, so the applications were taken up together. The adjudicating authority found that the Appellant was giving discounts up to 35% to dealers, distributors, and stockists who had provided advances, which were not adjusted in the final bill. This practice led to the suppression of the assessable value of goods with the intent to evade duty payment. The Commissioner (Appeals) confirmed that such discounts were not available to other customers. Despite the Appellant having already deposited Rs. 27,278/-, the Tribunal determined that there was no justification for waiving the pre-deposit of duty. The Tribunal directed the Appellant to deposit the remaining duty amount within four weeks from the date of the order, with the waiver of interest and penalties for the hearing of the appeals contingent on this deposit. The compliance deadline was set for 23-1-2012.

This judgment primarily addressed the issue of whether the Appellant should be granted a waiver of pre-deposit of duty. The Tribunal considered the practice of giving discounts to customers who provided advances, leading to the suppression of the assessable value of goods. The Tribunal found that the Appellant had not established a case for the waiver of pre-deposit, despite having already made a partial deposit. The decision emphasized the importance of complying with duty payment obligations and set a deadline for the remaining duty amount to be deposited to proceed with the appeals.

The judgment also highlighted the significance of adjusting advance payments in the final bill to ensure transparency in duty calculations. The Tribunal scrutinized the practice of providing discounts to specific customers who had given advances, emphasizing that such discounts should be reflected in the final billing process. The decision underscored the need for accurate assessment of the assessable value of goods to prevent evasion of duty payments and maintain fairness in commercial transactions.

Furthermore, the judgment outlined the specific compliance requirements for the Appellant, directing them to deposit the outstanding duty amount within a specified timeframe. The Tribunal linked the waiver of interest and penalties for the appeals to this deposit, emphasizing the importance of meeting financial obligations promptly to proceed with the legal process. The compliance deadline set by the Tribunal aimed to ensure timely resolution of the duty payment issue and facilitate a fair hearing of the appeals.

← Previous Next →