2006 (8) TMI 14 - AT - Central Excise

Central Excise Petroleum product - When duty paid goods cleared from depot, there is no excise duty shown separately in the invoices issued by appellant and no evidence produced that price collected from customers represented excise duty Demand not sustainable

Summary

Issues:
- Confirmation of demand for not depositing enhanced duty collected from buyers
- Requirement of evidence to prove collected amount represents excise duty
- Lack of separate mention of excise duty in invoices
- Applicability of earlier Tribunal orders

Analysis:
The appeal was filed against an adjudication order where the demand was confirmed due to the appellant clearing duty-paid stock of petroleum products from a bulk depot after an increase in excise duty, without depositing the enhanced duty collected from buyers. The Tribunal referred to a previous case involving a different depot, emphasizing the requirement under Section 11-D (1) of the Central Excise Act for the collected amount to represent excise duty. It was noted that no evidence was presented by the Revenue to demonstrate that the prices collected by the appellant from buyers indeed included central excise duty. The Tribunal highlighted the necessity of factual evidence, referencing a Board's Circular and emphasizing that the burden of proof lies with the Revenue. It was also mentioned that the prices of petroleum products are regulated by a committee, further casting doubt on the assumption that price increases were solely due to enhanced excise duty.

In a subsequent section of the judgment, it was noted that no excise duty was separately indicated in the invoices issued by the appellant during goods clearance from the depot. The lack of evidence to establish that the collected amount represented central excise duty led the Tribunal to conclude that the demand was not sustainable. The decision was influenced by the earlier Tribunal order and the principles established therein, emphasizing the importance of demonstrating the link between collected amounts and excise duty. The judgment ultimately set aside the impugned order and allowed the appeal, aligning with the precedent set by previous decisions.

The appeal filed by the revenue before the Supreme Court was dismissed, reinforcing the Tribunal's decision and further solidifying the stance that without concrete evidence linking collected amounts to excise duty, demands based on such assumptions are not tenable. The judgment, delivered in open court, underscored the significance of factual evidence and adherence to legal provisions in determining the liability for excise duty payments.