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TMI Blog2009 (10) TMI 348X X X X Extracts X X X X X X X X Extracts X X X X ..... he following show cause notices to recover duty on MTRs cleared by ITEL. Held that- if the goods were under provisional assessment, differential duty could be recovered without issuing a Show Cause Notice u/s 11A of the Act. Demand could not validly be confirmed invoking longer period as no suppression is found against ITEL. The impugned order held that the dispute involved interpretation. We hold that no penalty is imposable on the appellants for its failure to pay duty demand sustained by us since the dispute involved interpretation. The impugned order is set aside. The appeal is allowed in part by remand to the original authority to requantify the demand allowing benefit u/s 4(4)(d)(ii) of the Central Excise Act, and Cenvat credit of dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,88,919/- 5. 1252/96 dated 9-10-96 141/97 dated 25-4-97 7/96 to 9/96 6,86,838/- 6. 381/97 dated 1-5-97 85/98 dated 30-4-98 10/96 to 3/97 9,95,008/- 7. 783/97 dated 2.9.97 85/98 dated 30-4-98 4/97 to 8/97 4,60,010/- 8. 313/98 dated 2-4-98 109/98 dated 27-7-98 9/97 to 3/98 1,31,18,271/- 3. Following the decision of the Tribunal that assembly of MTRs was an exigible activity, the original authority confirmed the proposals to demand duty and to impose penalty on ITEL in de novo proceedings ordered by the Tribunal. A total Rs. 88,42,826/- being duty has been demanded and penalty of Rs. 95,000/- imposed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1-3-96 was time-barred except for a month as longer period could not be invoked. 5. We have heard both sides. We have carefully considered the case records and the submissions by both sides. As regards the proposals covered by the SCNs at Sl. Nos. 1 and 4 of the table, we find that the appellant had taken credit of the duty paid on the inputs and supplied the inputs to the job worker under Rule 57F(2) of CER. The rule provided for movement of inputs or intermediate goods without payment of duty for further manufacture and return to a manufacturer who would clear finished goods on payment of duty. Assessee had reversed the credit of duty taken on such inputs two years later, in 1996. By such reversal the assessee does not cease to be a ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hone to the external line like a plug connecting TV set to the mains. The telephone can be connected to the external line without the use of an MTR also. MTR is therefore an accessory and not an integral part of the telephone. We find that in the case of Shriram Bearings Ltd. v. CCE, Patna [1997 (91) E.L.T. 255 (S.C.)], the Apex Court held that value of accessories could not be included in the assessable value of the ball bearings even though the accessories were fitted with the ball bearings at the time of their clearance from the factory. Goods under assessment were ball bearings. In Final Order No. 358/03 dated 13-2-2005 [2003 (161) E.L.T. 581 (Tribunal)] in the case of same appellants, the Tribunal examined the issue whether the value o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under provisional assessment for the reason that telephones of CH 8517 was under provisional assessment. If no order had been passed under Rule 9B of CER ordering provisional assessment of MTR, the Revenue cannot confirm demand for a period beyond the normal period. This aspect will be seen by the original authority. The impugned order does not find suppression by ITEL. In any case if the goods were under provisional assessment, differential duty could be recovered without issuing a Show Cause Notice u/s 11A of the Act. Demand could not validly be confirmed invoking longer period as no suppression is found against ITEL. The impugned order held that the dispute involved interpretation. We hold that no penalty is imposable on the appellants f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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