2017 (7) TMI 1243 - AT - Central Excise

Sale of cement in 50 kg. bags - Concessional rate of duty - N/N. 4/2006-C.E., dated 1-3-2006 - institutional sales - Held that - An identical issue has come up before the Tribunal in assessee s own case DALMIA CEMENTS (BHARAT) LTD. VERSUS CCE 2008 (12) TMI 683 - CESTAT CHENNAI , where it was held that no RSP requires to be printed on the goods sold to industrial/institutional consumers as defined under the rules framed under the Standards of Weights and Measures Act and that such goods would be covered under Sl. Nos. IB and IC of N/N. 4/2006-C.E. by virtue of the second proviso to the Explanation to Sl. No. 1C of the Notification as amended - appeal allowed - decided in favor of appellant.

Summary

Issues:
- Entitlement to concessional rate of duty as per Notification No. 4/2006-C.E. for the sale of cement in 50 kg bags
- Interpretation of the Notification for goods sold to industrial/institutional consumers

Analysis:
The appeal was filed against the Order-in-Original passed by the Commissioner regarding the entitlement to a concessional rate of duty under Notification No. 4/2006-C.E. for the sale of cement in 50 kg bags. The appellant, engaged in cement manufacture, cleared cement in 50 kg bags without applying retail sale price, paying duty as per the said Notification. However, the department disallowed this. The Tribunal considered the issue and referred to a previous case where it was established that the benefit of the notification applied to goods sold to industrial/institutional consumers. The Tribunal emphasized that the benefit pertained to goods sold to such consumers and not subject to retail sale price requirements. The Tribunal set aside the impugned order and allowed the appeal based on the precedent set in the Grasim Industries Ltd. case.

In the detailed analysis, the Tribunal noted that the issue of entitlement to the concessional rate of duty under Notification No. 4/2006-C.E. for cement sales in 50 kg bags had been previously considered in a similar case. The Tribunal reiterated that the benefit of the notification extended to goods sold to industrial/institutional consumers, as clarified by the Central Board of Excise and Customs. The Tribunal emphasized that the opinion of the Legal Metrology Department, which focused on package labeling requirements, was not relevant to the issue of entitlement to the concessional rate of duty. The Tribunal emphasized that the focus should be on the nature of the consumers (industrial/institutional) rather than package labeling regulations. Based on the precedent set in the Grasim Industries Ltd. case, the Tribunal set aside the impugned order and allowed the appeal, as the benefit of the notification applied to the appellant's sales to industrial/institutional consumers, exempting them from retail sale price obligations.

Therefore, the Tribunal's decision was based on the interpretation of the notification in question, emphasizing that the concessional rate of duty applied to goods sold to industrial/institutional consumers, irrespective of package labeling requirements. The Tribunal relied on precedent and the clarification issued by the Central Board of Excise and Customs to support its decision to set aside the impugned order and allow the appeal.