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TMI Blog2015 (3) TMI 1152X X X X Extracts X X X X X X X X Extracts X X X X ..... the person who is surrendering the license or whose license is cancelled is required to pay all the arrears or pay duty on the goods. If they were to do so, the duty would have been collected on the date itself. Similarly if the appellants were to be aware of these provisions, they could have taken permission to store the goods elsewhere without payment of duty from the Commissioner explaining the peculiar circumstances and then also there could have been no problem. The Commissioner has the power to give permission to store the goods without payment of duty elsewhere. If the proper procedure was to be followed, duty would have been collected or permission would have been given for storage elsewhere keeping the fact in mind that the sugar manufactured by the appellant was to be cleared to the market only with the clearance of the concerned Government authority. However, have not been able to find legal provision which provides for enforcement of the demand made by the Revenue. - Decided in favour of assessee - E/488/2009-SM - Final Order No. 20775/2015 - Dated:- 6-3-2015 - Shri B.S.V. Murthy, Member (T) Shri Anil Kumar, Advocate, for the Appellant. Shri A.K. Nigam, AR, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or premises registered under Rule 9. Therefore, even if the applicant had stopped the activity of production/manufacture, till the stock was cleared they were entitled to continue with the registration. The assessee cannot be penalized for the errors committed by the officers of the department even if it is assumed that the registration certificate issued to the appellant was not cancelled by mistake. According to Circular No. 662/53/2002-CX., dated 17-9-2002, an officer granting registration has to carry out post facto verification within five days and cancel the registration if major discrepancies are found. This was not done in this case. No loss of revenue has occurred to the department and therefore interest cannot be demanded. According to the agreement with Shri Chamundeshwari Sugars Ltd., the appellant continues to have part of the premises where they had stored excisable goods under their control. In view of the above he would submit that the demand for interest is to be quashed. In the case of Jagdish Enterprise Pvt. Ltd. v. UOI [2014 (306) E.L.T. 381 (Guj), it was held that even if erstwhile owner ceased to carry on business and failed to apply for registration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... without payment of duty, a depot, premises of a consignment agent or any other place or premises from where the excisable goods are to be sold after their clearance from the factory. The transaction value is required to be determined at the place of removal. 5. The concept of place of removal itself has undergone drastic changes with the statutory changes discussed above. The stand taken by the department is on the ground that there cannot be two persons operating from the same premises. As far as manufacturing is concerned, there is no dispute that the appellant ceased to manufacture sugar or any product in the factory. In respect of any factory, at the time of registration, a ground plan is submitted wherein a warehouse is separately shown. The assessee is required to maintain a daily stock register, which requirement continues even now and the daily stock register shows the stock in the warehouse. Warehouse of a factory is the place wherein statutorily, a manufacturer can keep the goods manufactured by him without payment of duty. This is because even though the taxable event for levy of Central Excise duty is manufacture, collection takes place only at the time of removal. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stock registers; were clearing the goods on payment of duty and were using the same warehouse. Apparently, for their own purposes they could have divided the warehouse into two portions and one portion would have been used by the appellant for keeping their goods in stock and the other portion would have been used by Sri Chamundeshwari Sugars Ltd. to keep their stock. There is no contrary finding that such is not the case, or there was any defect or mix-up. It was also submitted that the sugar manufactured by the appellant could not have been cleared in the name of Sri Chamundeshwari Sugars Ltd. and therefore the appellants adopted this process. However, I do not consider this to be a relevant factor. If the law does not permit two persons from using the same warehouse, it cannot be done. 7. It is the case of the department that entire stock lying in the warehouse can be considered to have been removed on the date on which the premises was leased to Sri Chamundeshwari Sugars Ltd. If the factory is taken over from one person by another person, besides cancellation of registration certificate existing in the name of one person and issue of registration certificate to the other, ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nment agent would show that there can be different places of removal. That being the position, when the same warehouse is being used by two manufacturers and if there is a proper segregation, (there are no contrary findings) legally there appears to be no bar to the action taken by the assessee. 10. In view of the above, I consider that it cannot be said that there was deemed cancellation of registration certificate on 17-12-2007 and there was no deemed removal of sugar on the date of transfer and therefore there was no need for the appellants to pay duty before clearances and since they have paid the duty at the time of removal from the place of removal i.e. a portion of warehouse belonging to them, it has to be held that the demand for interest cannot be sustained. 11. One has to keep in mind that there are peculiar circumstances in this case. The departmental officers have failed to ensure that the registration certificate of the appellant was cancelled which invariably is done before a registration certificate is issued to the next person. In such cases invariably, the person who is surrendering the license or whose license is cancelled is required to pay all the arrears ..... X X X X Extracts X X X X X X X X Extracts X X X X
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