2002 (1) TMI 127 - AT - Central Excise

Summary

Issues: Valuation of captively consumed wax paper, applicability of extended period of limitation under Section 11A, validity of demand for excise duty.

In this judgment by the Appellate Tribunal CEGAT, the appellant, a manufacturer of razor blades, faced a dispute regarding the valuation of wax paper captively consumed for blade production. The appellant paid excise duty on the wax paper, taking Modvat credit, but later faced a demand for differential duty based on the cost of production. The Department sought to refix the price of wax paper for previous periods, invoking the extended period of limitation under Section 11A. The appellant objected, arguing that the extended period should not apply, citing a precedent where it was held that if Modvat credit is available to the assessee, there is no intent to evade duty. The Tribunal agreed, ruling that the demand beyond April to August 1998 was time-barred due to lack of intent to evade duty.

The Tribunal held that the demand for the period 1994-95 to March 1998 was barred by limitation, setting aside the demand, penalty, and interest for that period. The appellant was directed to pay the duty demanded for April to August 1998, with the option to take credit for the same. The judgment concluded by disposing of the appeal accordingly, clarifying the appellant's obligations and rights regarding the excise duty demands.