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Home Case Index All Cases Central Excise Central Excise + AT Central Excise - 2016 (3) TMI AT This

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2016 (3) TMI 66 - AT - Central Excise


Issues:
Revenue's appeal against the order-in-appeal of the Commissioner (Appeals) dated 10.09.2008.

Analysis:
The case involved an appeal filed by Revenue against an order-in-appeal of the Commissioner (Appeals) dated 10.09.2008. The Respondents, a company, cleared a significant number of inputs as damaged/rejected goods without reversing the Central Excise duty equivalent to the actual credit availed. The Respondents cleared the inputs at a lower transaction value than the original purchase value, leading to an alleged failure to pay duty equal to the credit availed on the damaged/rejected goods. The Respondents availed CENVAT credit on the purchase of the inputs but paid Central Excise duty on the lower value, resulting in a shortfall of duty payment. A show cause notice was issued, and the adjudicating authority confirmed the duty shortfall along with interest and a penalty.

The Commissioner (Appeals) set aside the order-in-original of the adjudicating authority, leading to Revenue's appeal before the Appellate Tribunal. After hearing both sides, the Tribunal examined the arguments and the impugned order-in-appeal. The Commissioner (Appeals) had considered the process of rejection of inputs by the company, involving quality control checks and subsequent rejection stages during the manufacturing process. The Tribunal found the reasoning and conclusions of the Commissioner (Appeals) to be legally correct and unassailable. Consequently, the Appellate Tribunal upheld the impugned order, dismissing the appeal filed by Revenue.

In conclusion, the case revolved around the duty payment shortfall by a company on inputs cleared as damaged/rejected goods. The Tribunal upheld the decision of the Commissioner (Appeals) based on the detailed analysis of the rejection process followed by the company and found no reason to interfere with the impugned order. The judgment highlights the importance of adhering to standard procedures and quality standards in manufacturing processes to determine the duty liability on cleared goods.

 

 

 

 

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