2014 (7) TMI 23 - AT - Central Excise

Duty demand - Whether the payment of duty made by the assessee at a price not declared by a price which is not covered by declaration filed under Rule 173C for the period from April, 1996 to February, 1997 is not correct and duty is required to be paid at the rate which was declared in the pricelist declaration filed for the previous year - Held that - in the absence of any evidence to show that the price/assessable value adopted by the appellant did not fulfil the requirements/conditions under Section 4(1)(a) of the Central Excise Act, 1944, mere non-fulfilment of procedural requirement cannot justify the demand for differential duty. We find that the decisions cited by the learned counsel are applicable to the facts of this case - there is a penalty of Rs. 10,000/- imposed for non-fulfilment of obligations under Rule 173C of the Central Excise Act, 1944. This was a statutory requirement which has not been fulfilled by the appellant and we consider that this penalty has to be sustained - Decided in favour of assessee.

Summary

Issues: Whether the duty payment made by the assessee at a price not declared under Rule 173C is correct, and if duty is required to be paid at the rate declared in the previous year.

Analysis:
1. The advocate for the appellant argued that the demand for differential duty was based on the assessee not filing a revised price declaration when selling goods at a lower price. He referenced a case where the Tribunal held that duty demand cannot be justified solely on the grounds of non-filing of a pricelist declaration if the price adopted for duty payment fulfills the requirements of the law.

2. The advocate further cited another Tribunal decision emphasizing that duty demand can only be made if valuation provisions under Section 4 of the Central Excise Act were not followed. He contended that procedural lapses should not hinder the determination of the correct duty payment value.

3. The AR reiterated the grounds from the adjudication order, but the Tribunal found that without evidence showing non-fulfillment of requirements under Section 4(1)(a) of the Act, mere procedural lapses do not warrant a demand for differential duty.

4. The Tribunal noted a penalty imposed on the appellant for not fulfilling obligations under Rule 173C. They upheld the penalty as a statutory requirement that was not met by the appellant.

5. Ultimately, the Tribunal allowed the appeal regarding duty demand, setting aside the confirmation of duty while upholding the penalty. The decision clarified the stance that mere procedural lapses do not justify a demand for differential duty when the adopted price fulfills legal requirements.