2018 (8) TMI 464 - AT - Central Excise

Cum duty benefit - clandestine removal of goods not in dispute - Held that - It is observed that the appellant have charged and collected the value at the time of clearance of the goods, subsequent to making out a case of demand of duty, the amount collected from the customers remained same, there is no extra consideration given to the appellant. In such case, value collected even though towards clandestine removal but the fact remains the price charged to the customer did not change even after the demand of duty, therefore, the price charged to the customer is a cum duty price and the benefit of cum duty price should have been given to the appellant. The appeal is disposed of by way of remand to the adjudicating authority for recalculating the demand after allowing the cum duty benefit.

Summary

Issues:
- Appeal against Order in Appeal upholding duty demand on goods clandestinely removed
- Appellant's plea for cum duty benefit not extended by lower authority

Analysis:
1. The appeal challenged the Order in Appeal affirming the duty demand on goods clandestinely removed. The appellant contended that the lower authority failed to grant the cum duty benefit, despite acknowledging the clandestine removal. The appellant argued that the value charged to the buyer, without collecting duty separately, should be considered as cum duty price, citing the judgment in Santosh Kumar Kishan Lal Jain vs CCE-2017 (348) ELT 351 (Tri.-Del), where similar benefit was granted even in cases of admitted clandestine removal.

2. The appellant's counsel emphasized that the amount collected from customers remained unchanged post the duty demand, indicating that the price charged was cum duty price. In contrast, the Revenue, represented by the Superintendent (AR), supported the impugned order's findings, asserting that since the goods were clandestinely cleared, the value charged to customers constituted the assessable value, precluding the cum duty benefit.

3. Upon careful consideration, the Member (Judicial) noted the undisputed clandestine removal and the sole contention raised by the appellant regarding the denial of cum duty price benefit. The Member observed that despite the clandestine nature of clearance, the price charged to customers remained constant post-duty demand, suggesting it to be cum duty price. Referring to the Tribunal's precedent in Santosh Kumar Kishan Lal Jain, where the entire consideration was deemed cum-duty price, the Member directed a remand to the adjudicating authority for recalculating the demand after granting the cum duty benefit to the appellant.

4. In line with the Tribunal's previous ruling, the Member concluded that the appellant was entitled to the cum duty benefit. Consequently, the appeal was disposed of through a remand to the adjudicating authority for reevaluation of the demand, factoring in the cum duty benefit as warranted by the circumstances.