2018 (2) TMI 1306 - AT - Central Excise

Demand of differential duty - penalty u/s 11AC - Cement - N/N. 4/2007-CE dated 01.03.2007 (as amended) - denial on the ground that clearances are to Andhra Pradesh State Housing Corporation and other construction builders is not covered under the said Notification and since their RSP is printed, which is not required to be printed, will fall under Clause 1C of the said Notification instead of Clause-1A - identical issue decided in the case of COMMISSIONER OF C. EX., HYDERABAD-III Versus SAGAR CEMENTS LTD. 2010 (4) TMI 418 - CESTAT, BANGALORE , where it was held that the requirement of not printing of the retail sale price is not applicable to the respondents, as the goods are sold to APSHCL by indicating the price at which it was contracted on each bag. It is also on record that there was no case of the Revenue that the respondents were not required to declare the retail sale price on the supplied bags - appellant eligible to clear the cement under Clause-1A. Penalty u/s 11AC - Held that - as the Bench on merits itself allowed the appeals of Penna Cement Industries Ltd, nothing survives in the appeal filed by the Revenue. Appeal allowed - decided in favor of appellant-assessee.

Summary

Issues:
Demand of differential central excise duty on the appellant/assessee, non-imposition of equivalent penalty under Section 11AC of the Central Excise Act 1944, and the issue of demands raised against the assessee by the Revenue.

Analysis:
The judgment by the Appellate Tribunal CESTAT Hyderabad involved multiple appeals related to Penna Cement Industries Ltd. and other parties against the Commissioner of Central Excise, Customs & Service Tax, Tirupati. The primary issue revolved around the demand of differential central excise duty on the appellant/assessee. The Revenue's appeal against Penna Cement Industries Ltd. was due to the non-imposition of an equivalent penalty under Section 11AC of the Central Excise Act 1944. Additionally, the Revenue was aggrieved by the Order-in-Appeal concerning Mancherial Cement Co Pvt Ltd, where demands raised against the assessee were dropped. The case of the Revenue was based on the asessees clearing cement in 50kg bags with printed RSP to various builders, claiming exemption under Notification No.4/2007-CE. The Revenue argued that the assesses were not eligible for the exemption, leading to a demand for differential central excise duty.

The Tribunal referred to a similar issue adjudicated by various Benches, including the Bangalore and Hyderabad Benches, in the case of Commissioner of Central Excise Hyderabad-III Vs Sagar Cements Ltd. The Tribunal noted that the requirement of not printing the retail sale price on bags did not apply to the assesses, as the goods were sold to APSHCL by indicating the contracted price on each bag. The Tribunal upheld the view that the impugned orders confirming the demand were unsustainable, citing precedents like Sagar Cements Ltd, Orient Cement Ltd., and H&R Johnson India Ltd., where similar issues were decided in favor of the assessee. Consequently, the Tribunal held that the appeals filed by the assessees would succeed, setting aside the impugned orders to that extent. However, the impugned order in the case of Mancherial Cement Co Ltd was deemed correct and legal.

Regarding the Revenue's appeal against Penna Cement Industries Ltd. for non-imposition of penalty under Section 11AC, since the Bench allowed the appeals of Penna Cement Industries Ltd on merits, the Revenue's appeal was rejected. Thus, all the appeals were disposed of accordingly with consequential relief, if any, granted.