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2015 (11) TMI 1409 - AT - Central ExciseSSI exemption benefit under Notification No.8/2001, 8/2002 and 8/2003 - clearance of the goods on their own account and paid duty in respect of clearance of the goods bearing brand name of the loan licensee - Invocation of extended period of limitation - Held that - Appellant had disclosed the location of the factory, clearance of goods on payment of duty separately in the ER-1 return. In any event, the Appellant cleared the goods bearing brand name of the loan licensee and declared in their ER-1 return. So, the Department was aware of the location of the factory in the rural area. Thus, there is no suppression of facts with intent to evade payment of duty. We also find that the decision of the Tribunal in the case of Pharmanza (India) (2009 (1) TMI 556 - CESTAT, AHMEDABAD) is squarely applicable in the present case. - demand of duty for the extended period of limitation cannot be sustained and the Adjudicating authority rightly dropped the demand for the extended period of limitation. The demand of duty with interest for the normal period of limitation is upheld. - Adjudicating authority directed to requantify the demand for the normal period of limitation as contended by the Assessee - Appeal disposed of.
Issues:
1. Limitation period for demand of duty. 2. Eligibility for exemption benefit. 3. Suppression of facts by the Assessee. 4. Adjustment of duty paid on branded goods. 5. Disclosure of factory location in rural area. Analysis: 1. Limitation period for demand of duty: The Adjudicating authority observed that the demand of duty was time-barred as there was no suppression of facts by the Assessee. The Tribunal, citing a previous case, held that the extended period of limitation cannot be invoked. The Assessee's plea that duty paid on branded goods exceeds the duty demanded and would neutralize the demand was accepted. The Tribunal directed the Adjudicating authority to re-quantify the demand for the normal period of limitation. 2. Eligibility for exemption benefit: The Assessee availed SSI exemption benefit under various notifications. The Revenue contended that the Assessee is eligible for exemption benefit in respect of goods bearing the brand name of the loan licensee due to the factory's location in a rural area. The Adjudicating authority dropped the proceedings on limitation but upheld the demand on merit. The Tribunal found that the Assessee had paid duty on branded goods and held that the demand for the extended period of limitation cannot be sustained. 3. Suppression of facts by the Assessee: The Adjudicating authority noted that there was no suppression of facts by the Assessee regarding the location of the factory in a rural area. The Tribunal agreed that the Department was aware of the factory's location and the clearances of goods. The Assessee had disclosed information in their ER-1 returns, and there was no intent to evade payment of duty. The Tribunal found no suppression of facts and upheld the dropping of the demand for the extended period of limitation. 4. Adjustment of duty paid on branded goods: The Assessee contended that the duty paid on branded goods exceeded the duty demanded, neutralizing the demand. Citing a previous Tribunal decision, the Tribunal agreed that duty paid on branded goods should be considered as a deposit and adjusted against the duty demanded. The Tribunal directed the Adjudicating authority to verify the duty paid on branded goods and adjust it accordingly. 5. Disclosure of factory location in rural area: The Revenue argued that the extended period of limitation should be invoked as the Assessee did not declare the factory's location in a rural area. However, the Tribunal found that the Assessee had disclosed the factory's location and clearances in their ER-1 returns. The Tribunal held that there was no suppression of facts and upheld the dropping of the demand for the extended period of limitation. In conclusion, the Tribunal upheld the demand of duty for the normal period of limitation, directed the re-quantification of the demand, rejected the appeal filed by the Revenue, and disposed of the Assessee's appeal accordingly.
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