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2020 (6) TMI 329 - AT - Central ExciseClearance of Cement - Benefit of exemption Notification No. 4/2007-CE dated 01.03.2007 (Sl No. 1A) - clearance of cement to M/s Andhra Pradesh Housing Corporation Ltd (APHCL) as well as for their own use in 50 kg bags declaring a retail sale price of less than 190/- per bag - Misstatement of facts or not - extended period of limitation - Interest and penalties - HELD THAT - There is no dispute that the goods manufactured by the appellant fall under the Chapter Heading 252329. Sl No. 1 of the exemption notification is not applicable to the present case as the appellant is not a mini cement plant. Sl No. 2 defines what constitutes the retail sale price and its third proviso says where the retail sale price of the goods are not required to be declared under Standards of Weights and Measures (Packaged Commodities) Rules 1977 and thus not declared the duty shall be determined as is in the case of goods cleared in other than packaged form. In other words if the retail sale price is not required to be declared and hence also not declared the goods shall be treated as if they are cleared in other than packaged form and charged to duty accordingly. Such cases are covered by Sl No. 1C of the exemption notification. Such cases are covered by Sl No. 1C of the exemption notification. In the case of Rain Commodities Ltd Vs CCE Tirupathi 2011 (1) TMI 490 - CESTAT BANGALORE where the cement was supplied to institutional buyers it has been held that Sl No 1A and 1B of the notification is not available to the appellant as in that case clearance of the product was in bulk form which was not disputed. Time Limitation - HELD THAT - The demand is also time barred and no evidence of fraud or collision or wilful misstatement or suppression of facts with an intent to evade payment of duty has been brought on record. It was only a case of the appellant s claim Vs the Revenue s claim. In such a case once the ER-1 returns are filed it would be reasonable to expect the Revenue officers to assess them and in case of any dispute raise a demand within the normal period of limitation - there is favour of the assessee on the ground of limitation. Interest and penalties - HELD THAT - As the demand is not sustainable on merits the question of interest and imposition of penalties either on the assessee or on their Chief Manager do not arise. Appeal allowed - decided in favor of appellant.
Issues Involved:
1. Applicability of Exemption Notification No. 4/2007-CE dated 01.03.2007 (Sl No. 1A). 2. Interpretation of the term "retail sale price" under the Standards of Weights and Measures (Packaged Commodities) Rules, 1977. 3. Invocation of the extended period of limitation under proviso to Section 11A of the Central Excise Act, 1944. 4. Imposition of penalties under Rule 25(1) of Central Excise Rules 2002 and Section 11AC of the Central Excise Act, 1944. 5. Personal penalty on the Chief Manager under Rule 26 of the Central Excise Rules, 2002. Issue-wise Detailed Analysis: 1. Applicability of Exemption Notification No. 4/2007-CE dated 01.03.2007 (Sl No. 1A): The appellant claimed the benefit of exemption under Sl No. 1A of Notification No. 4/2007-CE, which applies to goods not manufactured in a mini cement plant and cleared in packaged form with a retail sale price not exceeding ?190 per 50 kg bag. The primary dispute was whether the appellant’s goods fell under the third proviso to Sl No. 2 of the explanation to the notification, which states that if the retail sale price is not required to be declared and hence not declared, the goods should be treated as cleared in other than packaged form and charged to duty accordingly. The Tribunal found that although the retail sale price was not required to be declared, it was indeed declared by the appellant. Therefore, the appellant was entitled to the benefit of Sl No. 1A of the exemption notification. 2. Interpretation of the term "retail sale price" under the Standards of Weights and Measures (Packaged Commodities) Rules, 1977: The Tribunal examined the third proviso to Sl No. 2 of the explanation, which states that if the retail sale price is not required to be declared and hence not declared, the goods shall be treated as if cleared in other than packaged form. The Tribunal concluded that since the retail sale price was declared on the cement bags, the appellant’s goods did not fall under the mischief of this proviso. The Tribunal also referred to the first proviso to Sl No. 2 of the explanation, which states that if goods are cleared in wholesale packages containing standard packages with retail sale price declared, such declared retail sale price shall be considered for determining the rate of duty. 3. Invocation of the extended period of limitation under proviso to Section 11A of the Central Excise Act, 1944: The Tribunal found no evidence of fraud, collusion, wilful misstatement, or suppression of facts with an intent to evade payment of duty. The appellant had claimed the benefit of the exemption notification in their ER-1 returns, which were audited by the department. Given the absence of any fraudulent intent or suppression, the Tribunal held that the invocation of the extended period of limitation was unjustified and the demand was time-barred. 4. Imposition of penalties under Rule 25(1) of Central Excise Rules 2002 and Section 11AC of the Central Excise Act, 1944: Since the demand was found to be unsustainable on merits, the imposition of penalties under Rule 25(1) of the Central Excise Rules 2002 and Section 11AC of the Central Excise Act, 1944, was also deemed unwarranted. The Tribunal set aside the penalties imposed on the appellant. 5. Personal penalty on the Chief Manager under Rule 26 of the Central Excise Rules, 2002: The Tribunal found that since the demand itself was not sustainable, the question of imposing a personal penalty on the Chief Manager under Rule 26 of the Central Excise Rules, 2002, did not arise. Consequently, the penalty on the Chief Manager was also set aside. Conclusion: The Tribunal allowed the appeals, set aside the impugned order, and granted consequential relief to the appellant. The demand for duty, interest, and penalties was found to be unsustainable both on merits and on the ground of limitation.
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