2017 (11) TMI 1507 - AT - Central Excise

Provisional assessment - Rule 9B of Central Excise Rules, 1944 - case of appellant is that there is no order by the jurisdictional Assistant Commissioner in terms of Rule 9B - Held that - even though no order under Rule 9B, the assessment can be considered as provisional in view of voluntary execution of a bond with a provisional assessment clause by the appellants - The said bond, a general purpose bond containing various obligations as can be seen from the title of the bond. On a plain reading of the bond, it is very clear that the bond can be invoked against the appellants, wherever there is an infringement of the undertaking. In fact, there were certain provisions which were not at all relevant to the appellants, for instance, fulfillment of proof of export etc. The said bond does not indicate automatically the existence of the provisional assessment. Admittedly, there was no order under Rule 9B by the Assistant Commissioner. There is no supporting evidence to hold that there was provisional assessment during the material time - any demand for differential duty shall be restricted to the normal period in terms of section 11A of the Central Excise Act, 1944 - appeal allowed in part.

Summary

Issues Involved:
Assessment of Central Excise duty on petroleum products including additional charges like State Cess charges, Retail Pump Outlet Charges, Storage charges, and Railway Siding Charges for the period 01.03.1994 to 02.07.1996. Dispute over whether the assessment was provisional or not based on Rule 9B of Central Excise Rules, 1944.

Analysis:

Issue 1: Addition of Charges in Assessable Value
The dispute in the appeal pertains to the inclusion of State Cess charges, Retail Pump Outlet Charges, Storage charges, and Railway Siding Charges in the assessable value of petroleum products. The Board's Circular clarified that these charges should be added to the assessable value. Revenue initiated proceedings against the appellants for demanding and recovering differential duty for past clearances.

Issue 2: Provisional Assessment
The main contention revolves around whether the appellants were assessed provisionally for Central Excise duty during the relevant period. The appellants argued strongly on the aspect of limitation, emphasizing that there was no provisional assessment during that time. The impugned order considered the documents like AR3A and the bond dated 31.01.1995 to conclude that the assessment was provisional, despite the absence of a written order by the jurisdictional Assistant Commissioner as required under Rule 9B.

Analysis of Arguments:
The appellants disputed the findings, highlighting the lack of an order by the Assistant Commissioner under Rule 9B. They argued that the documents relied upon by Revenue were not theirs and that the general B-16 bond executed by them did not specifically indicate provisional assessment. The appellants stressed that the bond's conditions were broad and did not solely signify provisional assessment without a formal order under Rule 9B.

Judgment and Conclusion:
Upon review, the Tribunal disagreed with the Commissioner (Appeals) and held that the existence of a general bond with a provisional assessment clause did not automatically imply provisional assessment. Citing legal precedents, including Supreme Court and High Court decisions, the Tribunal emphasized the necessity of an order under Rule 9B to establish provisional assessment. As there was no supporting evidence of provisional assessment during the material time, any demand for differential duty was limited to the normal period under section 11A of the Central Excise Act, 1944. The impugned order was set aside, and the appeal was allowed in favor of the appellants.

This detailed analysis of the judgment addresses the issues of addition of charges in the assessable value of petroleum products and the crucial aspect of provisional assessment, providing a comprehensive understanding of the legal reasoning and conclusions reached by the Appellate Tribunal.