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2021 (8) TMI 902 - AT - Central ExciseSSI Exemption - countervailing duty paid - right to use the trademark in India - affixation of MRP on packing of goods - HELD THAT - Admittedly the goods in the present case are the imported goods and would have been cleared on the payment of countervailing duty, determined on the basis of the declared Retail Selling Price. If the goods at the time of clearance have suffered the countervailing duty on the basis of Retailing Selling Price and as per Section 4A, there cannot be any further demand, if the benefit of CENVAT Credit is allowed to the appellant. Tribunal has in the Appellants own case 2017 (5) TMI 619 - CESTAT MUMBAI , held in favour of admissibility of the CENVAT Credit to the appellant, in case they are asked to pay duty by denying the SSI exemption. Extended period of limitation - penalty - HELD THAT - Tribunal has held against invoking of the extended period for making the demand and penalties imposed in the earlier order, there are no reason to differ with that part of the order. Hence the penalties imposed are set aside and we hold that extended period cannot be invoked in this case, where the issue is purely an interpretational. The matter remanded back to original authority to allow the CENVAT Credit as admissible, of the duty paid by the appellants on these goods and other inputs and input services received by them, subject to production of the requisite duty paying documents - appeal allowed by way of remand.
Issues Involved:
1. Confirmation of duty and interest. 2. Confiscation of goods and imposition of penalties. 3. Eligibility for SSI exemption. 4. Admissibility of CENVAT Credit. 5. Invocation of the extended period for making the demand. Detailed Analysis: 1. Confirmation of Duty and Interest: The Commissioner (Appeals) confirmed the duty of ?3,34,551/- under Section 11A of the Central Excise Act, 1944, and ordered the recovery of interest under Section 11AB. The appellant argued that their activities did not amount to manufacture and hence were not liable for duty. However, the Tribunal noted that the appellant's activities of packing and labeling imported goods amounted to manufacture under Section 2(f) (iii) of the Central Excise Act. 2. Confiscation of Goods and Imposition of Penalties: The Deputy Commissioner refrained from confiscating goods valued at ?20,30,041/- but imposed a penalty of ?3,34,551/- under Section 11AC and Rule 25(1) of the Central Excise Rules, 2002. Additionally, a personal penalty of ?10,000/- was imposed under Rule 26. The Tribunal, however, found no suppression of facts or intention to evade duty by the appellant, thus setting aside the penalties and confiscation. 3. Eligibility for SSI Exemption: The appellant claimed SSI exemption, arguing that the brand "Magic Bullet" was registered in their name in India. The Tribunal agreed, stating that the appellant was entitled to SSI exemption as the brand name, though belonging to an overseas company, was permitted to be used by the appellant in India and registered in their name. The Tribunal relied on several judgments, including CCE v. ESBI Transmission Pvt. Ltd. and Bhalla Enterprises, to support this view. 4. Admissibility of CENVAT Credit: The Tribunal held that the appellant was entitled to CENVAT Credit on the duty paid on inputs and input services. The Deputy Commissioner and Commissioner (Appeals) had denied this on procedural grounds, stating that the appellant had not maintained necessary documents. However, the Tribunal emphasized that if the goods had suffered countervailing duty at the time of clearance, the appellant should be allowed to claim CENVAT Credit, subject to the production of requisite duty-paying documents. 5. Invocation of the Extended Period for Making the Demand: The Tribunal found that the demand for duty was time-barred as there was no evidence of intent to evade payment of duty by the appellant. The show cause notice was issued for a period beyond the normal limitation period, and the Tribunal held that the extended period could not be invoked as the issue was interpretational and there was no suppression of facts. Conclusion: The Tribunal set aside the impugned order and the order of the original authority, remanding the matter back to the original authority to allow the CENVAT Credit as admissible, subject to the production of requisite duty-paying documents. The penalties imposed were also set aside, and the extended period for making the demand was not invoked. The original authority was directed to decide the issue within three months of the receipt of the order.
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