2017 (11) TMI 30 - AT - Central Excise

Finalization of provisional assessment - Stock Transfer - appellant s contention is that they had submitted only information for the entire year - Held that - From the documents available on record, we are not able to understand how such month wise figures were arrived at by original authority. Appellant has also pointed out that they manufactured more than 50 varieties of horns and the cost of components for which vary from 12 paise to ₹ 65.50; that however adjudicating authority has taken an uniform cost of ₹ 4.28 for all the components - These aspects can be addressed only by having a relook on the finalization of provisional assessments, which would require remand of the matter to the original authority in both the cases - appeal allowed by way of remand.

Issues:
1. Finalization of provisional assessment for goods cleared during specific periods.
2. Calculation of differential duty and education cess based on CAS-4 costing.
3. Adjudication of differential duty demands by the original authority.
4. Appeal against the decisions of the Commissioner (Appeals) in both cases.
5. Submission of oral and written arguments by the appellant's counsel.
6. Adjudication of the appellant's contentions regarding provisional assessment.
7. Consideration of the cost of components and raw materials in the assessment.
8. Evaluation of previous assessment finalizations and duty payments.
9. Review of the provisional assessment finalization process by the Tribunal.

Finalization of Provisional Assessment:
The case involved two appeals concerning the finalization of provisional assessments for goods cleared during specific periods. The appellants resorted to provisional assessment due to the unavailability of overheads at the time of goods removal, as per Rule 7 of the Central Excise Rules, 2002. Differential duty and education cess were demanded based on CAS-4 costing for the respective periods. The Commissioner (Appeals) decisions were challenged in the appeals E/559/2008 and E/530/2009.

Adjudication of Differential Duty:
The original authority finalized the provisional assessments for the periods in question and demanded differential excise duty and education cess. The Commissioner (Appeals) upheld part of the demands in both cases. The appellant raised concerns regarding the calculation of differential duty, cost of production, and the basis for demands made by the adjudicating authority.

Appellant's Submissions:
The appellant's counsel argued that the differential duty demands were not justified, highlighting discrepancies in the assessment process. They emphasized the need to consider total duty paid during the financial years and questioned the uniform cost assumption for components. The counsel also pointed out inconsistencies in the calculation of raw material costs and previous assessment practices.

Tribunal's Decision:
After hearing both sides and examining the facts, the Tribunal found merit in the appellant's contentions. They noted discrepancies in the month-wise finalization of provisional assessments and the uniform cost assumption for components. The Tribunal ordered a remand of the cases to the original authority for a reevaluation, considering the appellant's arguments and allowing for additional evidence submission. The original authority was directed to complete the proceedings within three months.

Conclusion:
The Tribunal allowed the appeals by way of remand, emphasizing the need for a thorough reevaluation of the provisional assessment finalization process. The decision aimed to address the appellant's concerns regarding differential duty demands and ensure a fair assessment based on accurate information and calculations.

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