9911796707
TMI Blog2007 (2) TMI 461X X X X Extracts X X X X X X X X Extracts X X X X ..... given in the Tabular column. SCN-1 SCN-2 SCN-3 Period of Dispute 1-7-2000 to 31-12-2002 1-1-2003 to 31-3-2003 1-4-2003 to 31-12-2003 Dates of Show Cause Notice 12-12-2003 27-1-2004 21-4-2004 Amount of duty demanded Rs. 56,42,600/- Rs. 12,63,496/- Rs. 10,36,732/- Amount of duty already paid Rs. 21,13,080/- Rs. 10,36,749/- Rs. 10,36,732/- Amount of penalty imposed on the company Rs. 35,29,520/- and Rs. 5,00,000/- Amount of penalty imposed on the Director Rs. 1,00,000/- 3. S/Shri G. Shiva Dass and A.S. Monappa, the learned Advocates who appeared for the appellants urged the following points :- (i) The Commissioner has confirmed the demands on account of valuation. (ii) After 1-7-2000, the basis for payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of freight from the factory to the premises of the Consignment Agents as during that period, only the factory gate was considered as place of removal. After 1-7-2000, in respect of the sales from the depot, Rule 7 of the Central Excise Valuation Rules has to be invoked. In terms of that Rule, duty should be paid on the basis of "Normal Transaction Value". Normal Transaction Value is defined in Rule 2(b) of the Valuation Rules as the Transaction Value at which the greatest aggregate quantity of the goods have been sold. A perusal of the Annexure to the Show Cause Notice indicates that the Department, instead of trying to identify the sale price of the greatest aggregate quantity, has chosen to take the highest price available on either the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as held by the Apex Court in the case of Baroda Electric Meters Ltd. v. CCE - 1997 (94) E.L.T. 13 (S.C.). (v) After 14-5-2003, the 'depot' has also been defined as 'place of removal'. For the period after 14-5-2003, the appellants are not claiming any deduction towards freight and the differential duty on the entire differential amounts stands paid. (vi) The appellants have paid duty on the total realisation from the customers. In such a situation, there cannot be any intention to evade payment of duty. The appellants have not suppressed any fact from the Department. Therefore, the longer period cannot be invoked. The officers visited the unit on 12-2-2001. Hence, there cannot be suppression of fact for the period subsequent to 12-2-20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there is nothing wrong in reducing the price by an amount equal to the cost of transportation from the factory gate to the depot, as the depot was not a place of removal prior to 14-5-2003. It is in consonance with Rule 7 read with Rule 5 of the Central Excise Valuation Rules. During the period when the depot is also a place of removal, the appellants have stated that they had paid the differential duty demanded on account of the cost of transportation. The appellants have made another point that the department, while calculating the value for depot sales, has adopted the maximum price available on a date prior to the date of sale or after the sale instead of arriving at the normal Transaction Value in terms of Rule 7 as clarified by the Bo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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