2016 (10) TMI 230 - AT - Central Excise

Price escalation clause - supplementary invoice on the basis of the price escalation given by MSEB - whether demand is justified on the ground that supplementary invoice was raised but at the same time amount not received from MSEB? - Demand of duty with interest and penalty - Held that - The transformers/finished goods have already been dispatched to MSEB. The central excise duty is liable to be paid as soon as the invoices are raised - appeal rejected - decided against appellant.

Summary

Issues involved: Whether appellant is liable to pay central excise duty on supplementary invoices due to price escalation granted by Maharashtra State Electricity Board.

Analysis:
The appeal was against the order-in-appeal dated 27.6.2005. Despite the absence of representation from the appellant, the Tribunal decided to proceed with the appeal due to its age and narrow scope. The central issue revolved around the appellant's obligation to pay excise duty on supplementary invoices resulting from price escalation by the Maharashtra State Electricity Board (MSEB). The appellant argued that since they had not received payment from MSEB for the supplementary invoices, they were not liable to discharge excise duty. However, the Tribunal rejected this argument, emphasizing that the duty becomes payable once the supplementary invoices are raised, irrespective of actual receipt of payment. The Tribunal noted that the transformers had already been dispatched to MSEB, reinforcing the liability to pay excise duty on the entire invoiced amount.

The Tribunal found the conclusions of the lower authorities to be accurate and declined to interfere with their findings. Consequently, the Tribunal upheld the impugned order, affirming the requirement for the appellant to pay central excise duty on the supplementary invoices. The appeal was dismissed, and the decision was pronounced in court.