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TMI Blog2016 (8) TMI 344X X X X Extracts X X X X X X X X Extracts X X X X ..... pro-rata duty for 12 working days or is liable to pay the duty for the whole month and there after seek rebate for non working days under the proviso to Rule 9 of Pan Masala Packing Machine (Capacity determination and collection of duty) Rules 2008. 2. The brief facts are:- that the appellant is registered dealer and paying duty on manufacturer of Gutkha under Section 3A of the Act read with the Pan Masala Packing Machines (Capacity Determination and Collection of Duty) Rules 2008, hereinafter referred to Pan Masala Packing Machines Rules 2008 (for short). 3. The appellant vide letter dated 13.9.2012 intimated the Department that it intended to start commercial production w.e.f. 15.9.2012 and requested for unsealing of 11 mach ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. The Assistant Commissioner vide letter dated 16.11.2013 directed Superintendent Central Excise to unseal and install the 11 machines in the midnight of 18.11.2012. 9. The appellant from 19.11.2012 started the manufacture of pouches of MRP Rs. 1.00 and of MRP Rs. 2.00 10. For the month of November, the Appellant calculated that it was liable to pay Central Excise duty of Rs, 1,17,60,000/- on pro rata basis for 12 days ( 19.11.2012 to 30.11.2012). The Appellant therefore adjusted Rs, 1,17,60,000/- from the Abatement of Rs. 3,08,64,516/- sanctioned to it earlier vide Order 29.11.2012 by the Assistant Commissioner. After adjustment amount of Rs. 1,91,04,516/- remained from the abated amount. The Appellant informed the Departm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with interest. 13. The appellant replied that it was not liable to pay duty for the entire month. Thereafter a Show Cause Notice dated 25.9.2013 was issued to the Appellant asking it to Show Cause why - a) The Central Excise duty short paid amounting to Rs. 1,08,00,000/- (Rupees one crore eight lakhs only) should not be demanded and recovered from them under Section 11A of the Central Excise Act 1944 read with Rule 9 of the Pan Masala Packing Machines (Capacity Determination and Collection of Duty) Rules 2008 and Notification No. 42/2008 -CE dated 1.7.2008 as amended in respect of production/clearance effected by them for Gutkha during the month of November 2012 b) The intere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at month they have operated the Packing Machines„ Being aggrieved the appellant is before the Tribunal and urges the Ld. Commissioner have totally misconceived the provision for Pan Masala P.M. Rules, 2008. Under the provision Rules 9 read with Rule 7 of Pan Masala P.M. Rule, 2008 provides that the duty of particular month has to be calculated, to the rate with the number of operating Pan Masala P.M. in the factory during the month. There is no dispute out of 11 Packing Machines, 6 of the Packing Machine had been used for packing of Pouches with MRP Rs. 1 and 5 Machine were operated for packing of pouches with MRP of Rsu 2. Further Rule 9 states that the per month duty shall be payable by 5th of same month under intimation to Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uous period of 15 days or more, the duty calculated on a proportionate basis shall be abated in respect of such period if the manufacturer of such goods fulfils such conditions as may be prescribed." 15.3 Further Rule 10 of P.M. P.M. Rules provides for abatement without prescribing that order of abatement will be passed by the Revenue, as both sealing and unsealing of Packing Machine is done by the department. 15.4 Further urges that the issue is not longer res-integra. In Shri Flavours Pvt. Ltd. vs. CCE Delhi-IV reported in 2014 (304) E.L.T. 441, (Tri.), this Tribunal allowed the appeal of assessee and held that where a manufacture unit is aware of the period of closure of its unit, before the duty is deposited by them for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of every month cannot result in depriving the assessee of the pro rata abatement of duty which he is in any way entitled to since admittedly in the present case there has been a closure of the factory from 14th to 31st August, 2012 and an abatement order has also been passed on 28th August, 2012. However, the assessee would be liable to pay the interest for the period of late deposit of duty."
18. Accordingly we hold that the impugned order is bad and against the provisions of Section 3A of the Act read with Rules 7,8,9, & 10 of Pan Masala P.M. Rules, 2008. The appeal is allowed and impugned order is set aside. Appellant is entitled to consequential benefits.
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