2017 (5) TMI 756 - AT - Central Excise

Classification of goods - Soft Drink Concentrates - admissibility of benefit of N/N. 3/2005-CE dt.24.02.2005 - For Soft Drink Concentrates there are only two sub headings one for Sharbat which is covered by Heading 2106.9011 and second one is Other category which is covered by Heading 2106.9019 - under what sub-heading the Soft Drink Concentrates will be classified? - Held that - there cannot be two opinions regarding the classification of the item Soft Drink Concentrates (unbranded) and therefore its correct classification is 2106.9019 only - the assessee is pleading the classification of their goods under Central Excise Tariff Sub Heading 2106.9099 for which there is no basis as per the material given by them especially when there is specific entry for Soft Drink Concentrates in the Tariff as mentioned above. Therefore the appellant s pleading for the said classification is rejected. Benefit of N/N. 3/2005-CE dt.24.02.2005 - Held that - the goods have already been sold to the customers and there is no likelihood of further recovery from the past consumers of any duty of Central Excise if levied and confirmed against the appellant now - Hon ble Supreme Court in the case of CCE Delhi Vs Maruti Udyog Ltd 2002 (2) TMI 101 - Supreme Court has held that the sale price realized by an assessee should be regarded as the price inclusive of excise duty as the purchaser has no obligation to pay any amount in excess of what has already been paid as the price for the goods purchased - the Appellant is entitled to cum duty benefit for the sales made during the period under dispute and the liability of duty of Central Excise against them is to be computed accordingly for which the matter is being remanded to the Adjudicating authority. Appeal allowed by way of remand.

Summary

Issues Involved:
Classification and admissibility of benefit of Notification No.3/2005-CE for Soft Drink Concentrates.

Analysis:

Classification Dispute:
The appellant, M/s Pioma Industries, appealed against the classification of their unbranded Soft Drink Concentrates under Central Excise Tariff Sub Heading 21.06.9099, while the Department argued for classification under Sub Heading 2106.9019. The Tribunal analyzed the Central Excise Tariff and concluded that the correct classification for Soft Drink Concentrates is under Heading 2106.9019 as 'Others'. The Tribunal highlighted that there are only two subheadings for such products - one for 'Sharbat' and the other for 'Others'. The appellant's plea for classification under Sub Heading 21.06.9099 was rejected as it lacked merit, given the specific entry for 'Soft Drink Concentrates' under Heading 2106.9019.

Admissibility of Notification No.3/2005-CE:
The appellant sought the benefit of Notification No.3/2005-CE for their goods, which mentioned Sub Heading 2106.9099. However, since the goods were correctly classified under Sub Heading 2106.9019, the Tribunal ruled that the benefit of this notification was not applicable to the goods in question.

MODVAT/CENVAT Credit and Cum-Duty Benefit:
The appellant requested MODVAT/CENVAT Credit for inputs used in manufacturing their product and the benefit of 'cum-duty'. The Tribunal acknowledged that under the Indirect Tax Scheme of India, such credits are generally allowed. Citing a Supreme Court case, the Tribunal emphasized that the sale price already includes excise duty, and the purchaser is not obligated to pay any additional amount. Therefore, the appellant was granted the benefit of MODVAT/CENVAT Credit for inputs used. The Tribunal directed the Adjudicating authority to re-quantify the Central Excise duty liability considering the cum-duty benefit for sales made during the disputed period.

In conclusion, the Tribunal modified the impugned order, remanding the matter to the Adjudicating authority for re-quantification of the Central Excise duty liability, with the appellant entitled to MODVAT/CENVAT Credit and cum-duty benefit.