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TMI Blog2013 (9) TMI 495X X X X Extracts X X X X X X X X Extracts X X X X ..... ion and Collector of Duty) Rules, 2008 (hereinafter referred as "2008 Rules") was not taken into consideration by Tribunal although this was direction by Hon'ble High Court to consider independent of clarification issued by Government of India. 2.1 Learned Counsel moving the application on behalf of appellant specifically submitted that when the same single machine of appellant was used in manufacture of Pan Masala of RSP of Re. 1/- and Gutkha of RSP of Re.1/- in the month of August, 2008 and January, 2009, duty was levied by Revenue holding that the appellant shall be liable to duty as if 2(two) machines were in operation during these 2 (two) months for manufacture of two products although duty was payable for each of the two months in respect of operation of one machine only. Duty was paid at a higher rate as applicable to manufacture of Gutkha although Pan Masala was also manufactured in January, 2009. 2.2 Secondly, it was argued that for the months of September, 2008 to December, 2008 when three products viz., Pan Masala of RSP of Re. 1/-, Gutkha of RSP of Re.1/- and Gutkha of RSP of Re.0.50 were packed operating the said single machine, the appellant paid duty as that was pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... direct pre-deposit of Rs. 20.00 lakhs in absence of financial difficulties of appellant, there was no scope for impression of pre-deposit order for Rs. 10.00 lakhs. 5.2 Right of appeal being conditioned by pre-deposit under section 35F of the Act, such pre-condition operates. Tribunal being subordinate to Hon'ble High Court it has carried out directions of the Hon'ble Court to do justice to both sides as early as possible by above reasoned pre-deposit order when it was noticed that balance of convenience did not tilt in favour of appellant heavily. 5.3 When the present Misc. application was moved by learned counsel, looking to the gravity of demand we again made survey to section 3A of the Act and provisions of 2008 Rules summarily. Section 3A contains overriding provision to prescribe methodology of levy of excise duty keeping in view the nature of process of manufacture or production of excisable goods of any specified description, the extent of evasion of duty in regard to such goods or such other factor as may be relevant to safeguard interest of Revenue. With such mandate, the 2008 Rules were framed. The dominant consideration for the event of levy is nature of process of ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Evasion prone goods are brought to duty by one such measures in law. 5.8 We are conscious that keeping in view the object to Rule 4 & 5, the deeming provision in Rule 8 of 2008 Rules was enacted. According to proviso to Rule 8, in case a manufacturer commences manufacturing of goods of a new retail sale price during a month on an existing machine, it shall be deemed to be an addition in the number of operating packing machine for the month. This proviso does not appear to have run counter to the scheme of levy when different goods of different description and nature as well as composition or same goods of different RSPs are packed by an existing machine to provide basis of levy since factor for levy is machine. Accordingly, prima facie, it appears that number of machines are deemed to have been used for different products packed in a month or same products packed even by a single machine with more than one RSPs packed during the month. 6. Of course, aforesaid view is prima facie and the appeal shall be heard in length when pre-deposit is made as an interim measure. As against aggregate demand of Rs. 2.5 crores, direction for pre-deposit of Rs. 20 lakhs which is nearly 8% of dem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r pouch 12,50,000 0 12,50,000 Oct 08 1 Pan Masala With RSP Rs.1 per pouch 9,25,000 0 9,25,000 Gutka With RSP Rs.1.00 12,50,000 6,45,161 6,04,839 Gutka With RSP Rs.0.50 per pouch 12,50,000 0 12,50,000 Nov 08 1 Pan Masala With RSP Rs.1 per pouch 9,25,000 0 9,25,000 Gutka With RSP Rs.1.00 12,50,000 12,50,000 0 Gutka With RSP Rs.0.50 per pouch 12,50,000 0 12,50,000 Dec 08 1 Pan Masala With RSP Rs.1 per pouch 9,25,000 0 9,25,000 Gutka With RSP Rs.1.00 per pouch 12,50,000 12,50,000 0 Gutka With RSP Rs.0.50 per pouch 12,50,000 0 12,50,000 Jan 09 1 Pan Masala With RSP Rs.1 per pouch 9,25,000 0 9,25,000 Gutka With RSP Rs.1.00 per pouch 12,50,000 12,50,000 0 1,80,50,000 55,20,161 1,25,29,839 10. As may be seen from the above table the disputed demand for duty arises on two accounts, namely, 10.1 Issue No. I (i) According to Revenue when one machine is used for making two products namely Gutka and Pan Masala for purpose of calculating duty liability under the said Rules, it should be counted as two machines in operation as per proviso to Rule 8 of the said Rules. Appellant submits that thes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uessing what is the intention. 13. There was a similar matter considered subsequent to the decision in this matter taken on 22-09-11, by another division Bench at stay stage in the case of M/s Phool Chand Sales Corporation Vs. CCE Lucknow in appeal Nos. E/Appeal Nos. 1301-1302/2011. The facts of that case are different in as much as the manufacturer in that case was manufacturing Pan Masala of RSPs of Rs. 1 per pouch and Rs. 0.50 per pouch. Both the items were falling under the same slab in the notification prescribing duty rate. So prima facie a view was taken that there may not be a case for considering that the manufacturer was manufacturing Pan Masala of two different RSPs because though the RSPs were different the duty liability was the same in that case. In this case which was originally decided before the decision in that stay petition was taken, it was seen that the manufacturer was manufacturing Pan Masala and Gutka on the same machines and the duty rates for these goods are different even when the RSPs are the same. Considering this aspect I do not find any case to change the earlier order calling for pre-deposit of Rs. 20,00,000/-which is about 16% of the confirmed dema ..... X X X X Extracts X X X X X X X X Extracts X X X X
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