2016 (9) TMI 1056 - AT - Central Excise

Demand - differential duty - misdeclaration of MRP on gas stoves - stock of goods of the relevant period i.e. 1998-99 has been seized from anywhere showing MRP at higher level than that was declared by the noticee - evidence of sale of the excisable goods to consumers at prices higher than declared to the Department - statements of the authorized signatory Shri Sandeep Jain taken. It may mention that gas stoves fall under Chapter sub-heading 7221.10 of the Schedule to the CETA, 1985. The law requires that Maximum Retail Price has to be declared on the packages of subject goods and correct duty payment is to be accordingly made. But in the instant case, two sets of stamps were kept by the appellant. The plea taken by the appellant is indeed vague. The background of the matter is that the appellant has been charged for evasion of duty by violating law, that specifically relate to the payment of duty on the MRP value of the excisable goods which has been admittedly violated in the statements recorded under statutory provisions. In such background, the cartons and stamps found are critical piece of evidence for the detected evasion and that support charges against the appellant. The MRP of the product on cartons was enough and does not require presence of gas stove in the carton. Gas stove in the carton is sufficient for the customer to know the MRP. Therefore, we find no reason to interfere with the impugned order. The same is sustained. - Decided against the appellant

Summary

Issues:
Alleged misdeclaration of Maximum Retail Price (MRP) on gas stoves leading to evasion of Central Excise duty.

Analysis:
The case involved appeals filed by a partnership concern and an individual regarding the alleged misdeclaration of MRP on gas stoves, which led to the evasion of Central Excise duty. The Central Excise officers visited the factory premises based on specific information and found discrepancies in the MRP declarations on rubber stamps and cartons. The officers compared the declared MRP with the stamping on cartons and conducted inquiries with dealers, leading to the imposition of duty by the first appellate authority.

The appellant's counsel argued that there was no substantial evidence supporting the allegations, emphasizing the lack of seized goods showing higher MRP than declared. They also contested the reliability of statements obtained under pressure and argued against imposing penalties on the partner individually. The case was primarily built on MRP stamped on carton sheets provided by a dealer, with allegations of evasion based on maintaining two sets of MRPs.

On the other hand, the Authorized Representative for the Revenue supported the impugned order, alleging that the appellant maintained dual MRPs to evade duty, affecting wholesalers and retailers. They highlighted the provision of a personal hearing and cross-examination opportunities, indicating fair procedural conduct.

After considering the arguments and evidence, the Tribunal noted that gas stoves fall under a specific tariff sub-heading requiring MRP declaration for correct duty payment. The appellant's possession of two sets of stamps was deemed suspicious, with the Tribunal finding the plea vague. The cartons and stamps were considered crucial evidence supporting the evasion charges, as the MRP on cartons was deemed sufficient for consumers, regardless of the presence of the gas stove inside.

Ultimately, the Tribunal upheld the impugned order, dismissing the appeals based on the totality of facts and circumstances. The decision was based on the critical evidence of stamped cartons and the appellant's violation of duty payment regulations related to MRP declarations.

In conclusion, the judgment affirmed the imposition of duty based on the evidence of misdeclaration of MRP, highlighting the importance of accurate MRP declarations on excisable goods to ensure proper duty payment compliance.