2018 (10) TMI 515 - AT - Central Excise

Finalisation of differential duty - disallowance of abatements - finalisation of duty ordered on the ground that the assessments were provisional - contention of the appellant is that, in the absence of explicit noting of provisional assessment and the various securities attached to such assessment, there can be no provisional assessment and, consequently, any demand beyond the normal period of limitation in section 11A of Central Excise Act, 1944 would not lie against them. Held that - It is clear from the various decisions of the Hon ble Supreme Court and of the Tribunal that the various prerequisites, enumerated by the appellant while adverting to the nature of assessment, would not be essential to the extent that the circumstances did not admit to an absence of doubt about the finality of the assessment. It is the normal practice for assessment to be provisional when the duty liability is discharged at the time of clearance from the factory gate without simultaneous delivery of the goods to the customer. The liability to duty, arising after abatement of the various cost claimed to be post-manufacture, is an obligation under law. The limitation on demand of duty will have to be established on substantial grounds and not by recourse to a claim for disallowance of provisional assessment. In the absence of an order of final assessment, and in the context of a demand for recovery based on the various submissions made by the assessee, it would not be appropriate to set aside the detailed findings in which the original authority has, having taken note of the limited terms of remand of the Tribunal, held the assessment to have been provisional - appeal dismissed - decided against appellant.

Summary

Issues:
1. Assessment of central excise duty for the period between 1990-91 and 1993-94 deemed provisional or final.
2. Determination of differential duty liability for recovery.
3. Compliance with procedural requirements for provisional assessment.
4. Bar on recovery of duty beyond the normal period of limitation.
5. Validity of abatements claimed by the assessee.

Analysis:

1. The Tribunal was tasked with determining whether the assessments of central excise duty for the period between 1990-91 and 1993-94 were provisional or final. The appellant, M/s Berger Paints India Ltd, argued that the assessments were final as no specific order directing provisional assessment was issued. The Tribunal, during the former round of litigation, had left this issue for the lower authorities to decide.

2. The original authority held that the assessments were provisional and directed the assessee to cooperate in finalizing the differential duty liability. The Commissioner of Central Excise (Appeals) upheld this decision, leading to the present appeal.

3. The appellant contended that certain procedural requirements for provisional assessment, such as the execution of a bond and explicit noting of provisional assessment, were not fulfilled. They relied on legal precedents to support their argument that without these prerequisites, the assessment should be deemed final, and any demand beyond the limitation period should be barred.

4. The issue of recovery of duty beyond the normal period of limitation under section 11A of the Central Excise Act, 1944 was raised. The appellant argued that without a clear indication of provisional assessment, any demand made beyond the limitation period should not be enforceable.

5. The validity of abatements claimed by the appellant in the prices charged for sale from various depots was also contested. The appellant argued that these abatements were not related to manufacturing and should be excluded from the assessable value at the factory gate. However, the lower authorities had discarded these claims.

In conclusion, the Tribunal found no reason to disagree with the lower authorities' findings that the assessments were provisional. The dismissal of the appeal was based on the original authority's detailed examination, the absence of flaws in their order, and the upholding of this decision by the first appellate authority. The judgment highlighted the obligations under law regarding duty liability, the significance of procedural requirements for provisional assessment, and the limitations on recovery of duty beyond the prescribed period.