9911796707
TMI Blog2002 (5) TMI 563X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant received part of the price of Liquid Chlorine sold by them in cash, outside the invoice price and books of accounts of the company. It had been alleged that from Chlorinated Paraffin Wax (CPW) manufacturers, who purchased liquid chlorine from the appellant as their raw material, the appellant collected part of the price in cash. Such cash component of the price was over and above the price mentioned in the invoices covering the sales. As central excise duty was paid treating invoice price as assessable value, it had been alleged that central excise duty was evaded to the extent payable on the cash component of the price. The impugned order upheld the allegation as established from the appellant s own records and other evidence. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the appellant based on the assessable value of M/s. Punjab Alkalies Chemicals Ltd. Appellants contend that it would have been more appropriate and reasonable to compare the appellant s sale price with the price of SIEL Food Fertilizer, New Delhi (SFFI), a company nearer to the appellant s place of production than Punjab Alkalies. It is also pointed out that the sale prices of (SFFI) were lower than that of Punjab Alkalies. Another objection which is more basic and purely legal in nature is that the adjudicating authority should have determined the assessable value of the goods by adding the cash collection (additional consideration) to the invoice price and determined the short levy as provided by Rule 5 of Central Excise Valuation Ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of penalty under Section 11AC of the Central Excise Act. The submission in this regard is that these legal provisions came into existence subsequent to the period covered by the demand in the impugned order and these legal provisions have no application to the appellant s case. 6. Learned SDR has very vigorously contested the objections, raised by the appellant. It has been submitted that once the offence has been fully established by documentary and other evidence, the appellant submission regarding compulsion to dispose of stock at available price etc. ceased to have any credibility. With regard to the method adopted for valuation, he explained that it was not possible to work out the value by adding the extra cash collection to the inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... malpractice by the company s management led to central excise duty evasion, as payment of duty was not on the full price of the goods but only on that portion of the value which was entered in the invoices. Therefore, the impugned order is right in demanding duty short levied and short paid by invoking the longer period as per proviso to Section 11A of Central Excise Act. 8. Serious contest in the appeal proceedings has been raised only about the method of quantification. The appellant s contention that the duty should have been demanded on the excess/extra collection under Rule 5 of the Central Excise Rule is not workable in the facts of this case. Rate per M.T. of cash collection varied (Rs. 1500/- - Rs. 3100/- pmt) depending upon type ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ces for both the units. Thus, after considering the evidence on record and the submissions of both sides in detail, we are of the view that the short levy amount is required to be worked out afresh adopting the assessable value of SFFI as the basis. If by any chance, for a given period SFFI assessable values are not available, computation may be done based on the assessable value of Punjab Alkalies. In either case, computation should be on the basis of assessable value for corresponding date/period or in its absence on the basis of assessable value worked out on weighted average basis. We make it clear that we find no merit in the appellant s submission that the reassessment could not be for the entire period April, 1995 to August, 1996 sin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rest. Undisputedly the period of duty demand is prior to the coming into force of Section 11AB. The demand for interest therefore is without legal sanction. It is set aside. 10. In view of our findings above, the appeal is ordered as under - (i) The amount of short levy shall be re-computed by the adjudicating authority based on the assessable value of SFFI for liquid chlorine for the corresponding period. The appellant shall be heard on this score. (ii) The duty so recomputed shall be adjusted from the deposit already made by the appellant. If the amount in deposit is found to be insufficient, the appellant shall pay the amount short immediately upon receipt of the order of re-computation. If the deposit already made is in e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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