9911796707
TMI Blog2019 (5) TMI 126X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee is a manufacturer of petroleum products such as Motor Spirit, Naphtha, High Speed Diesel Oil and LPG falling under Chapter 27 of Central Excise Tariff Act, 1985. They cleared the aforesaid products through pipeline from refinery to Vishaka Vijayawada Pipeline (VVPL) which was located near their refinery under stock transfer. Thereafter from the pipeline the products moved through pipelines to their depots located at Rajahmundry, Suryapet, Ghatkesar and Vijayawada from where the products are sold. The present dispute pertains to Naphtha which was stock transferred by the refinery to VVPL. From VVPL it is transferred to Rajahmundry and Vijayawada from where it was sold to private parties like M/s Reliance Energy, M/s Spectrum and M/s L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, 2002. The prayer of the assessee/appellant is to set aside the impugned order including penalty and sanction refund of the amount which they have already paid. 3. The assessee's appeal is on the ground that they had paid the entire excise duty including interest during the course of investigation itself and therefore, it was wrong on the part of the department to have issued a show cause notice in the first place. He would rely on Sec.11A(2B) of the Central Excise Act which specifically states that if the short paid duty has been paid by the assessee thereon ascertaining themselves or on the basis of duty ascertained by Central Excise officer before the notice got served on him, no notice under Sec.11A(1) should be served upon the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and place of removal, the applicable value shall be the price at which such goods are sold from the depot at the time closest to the time of removal. In other words, if the goods are cleared on Monday morning at 10AM from the factory, the price at which such goods were sold closest to this date and time from the depot forms assessable value for the goods cleared from the factory. Therefore, the differential duty appears to have been correctly calculated by the DGCEI during the investigation. They have already paid the entire amount of excise duty along with interest even before the show cause notice was issued. Under such circumstances in terms of Sec.11A(2B), no show cause notice should have been issued to them in the first place and also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if the duty has to be paid at the time of removal of goods the nearest price which will be available is the price at which the goods have already been cleared. The assessee cannot predict the price at which the goods might be cleared after the removal nor can he predict when such sale will take place. A plain reading of Sec.4 read with Rule 7 would show that clearance at a price nearest to the time of removal would mean the price which will be available to the assessee at the time of removal as being the price at which the goods were sold. It is impossible for the assessee to predict what will be the price after the removal of goods and when such transaction will take place. Therefore, we find no infirmity in the order of the learned Commis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at which they will be discharging Central Excise duty from the factory and subsequently, sold it at a higher price from the depot which indicates their intention to evade payment of duty. Therefore, we find no force in the argument of the assessee that no show cause notice should have been issued to them under Sec.11A nor do we find any force in the argument of the assessee that they will not be liable to penalty under Sec.11AC. In conclusion, we find no force in the appeal of the revenue. We also find no force in the appeal of the assessee.
9. The impugned order is upheld and the appeals filed by the revenue and the assessee are both rejected.
(Operative part of this order was pronounced in the open court on conclusion of hearing) X X X X Extracts X X X X X X X X Extracts X X X X
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