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TMI Blog2019 (5) TMI 870X X X X Extracts X X X X X X X X Extracts X X X X ..... ies and they cannot be equated with each other. Section 4A of the Central Excise Act, 1944 covers only those excisable goods which are required to declare the retail sale price under the provisions of legal Metrology Act, 2009. Even if the goods are presumed to be listed under Notification 49/2008, the same would not be covered under the provisions of Section 4A of the Central Excise Act, if these are not covered by the provisions of the legal Metrology Act, 2009 and the Rules framed therein. As per explanation of above Notification 49/2008-CE (NT), retail sales price means the maximum price at which the excisable goods in packaged form may be sold to the ultimate consumer and includes all taxes, local or otherwise, freight charges, commission payable to dealers and all charges towards advertisement, delivery, packing, forwarding and the like, as the case may be, and sale price is the sole consideration for such sale. Thus it can be seen that the retail sale price is defined with reference to sale to the ultimate consumer only whereas the industry or institutional consumers are not ultimate consumers - There is no dispute about the fact that the Appellants are selling the goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A/10843-10844/2019 - Dated:- 13-5-2019 - MR. RAMESH NAIR, MEMBER (JUDICIAL) And MR. RAJU, MEMBER (TECHNICAL) Sh. Anil Gidwani, Consultant for the Appellant Sh. Sameer Chitkara, Authorized Representative for the Respondent ORDER PER: RAMESH NAIR The present appeals have been filed by M/s Riddhi Corporation (RC) and also by the Revenue. Appeal No. E/10783/2015 against OIO No. AHM-EXCUS-001-COM-005-14-15 dated 23.01.15 for the period 2009-10 to 2013-14 has been filed by M/s RC whereas the Appeal No. E/11267/16 against OIO No. AHM-EXCUS-001-COM-016 dated 11.03.2016 has been filed by the Revenue covering period April to September 2014. The brief facts of the case are that M/s RC are engaged in the manufacturing of Front Guard Assy Black, Front Guard Kit, Leg Guard, Footrest Step, Round R R Guard, Kit- Guard Activa, Rear Guard with W Fitting, Side Panel, Front Bumper with nuts and parts for M/s Honda Motors India Pvt. Ltd (HMIPL) and M/s India Yamaha Motors Pvt. Ltd (IYMPL) and M/s Jit Industries. The Appellant after manufacturing of such goods are clearing to the above buyers without af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssifiable as parts of automobile, parts of two wheelers or accessories and whereas the valuation of the same would be in terms of Section 4 or Section 4(A) of the Central Excise Act along with serial No. 108 of Notification No. 49/2008- CE (NT) dated 24.12.2008. The adjudicating authority set aside the demands holding that the goods were assessable to duty in terms of Section 4 of Central Excise Act. 3. Shri Anil Gidwani, Ld. Consultant, appearing for M/s Riddhi Corporation submits that the impugned goods are accessories of the vehicles and not parts as they are not used in the manufacture of two wheelers. It is not a component of the vehicle nor it is cleared along with the vehicles by the two wheeler manufacturers. He explains the terms accessories, parts, components and assemblies to submit that parts and parts accessories are two different identifiable goods. The Notification No. 49/2008 CE (NT) covers only parts , and therefore, it cannot be read as applicable to the accessories. The accessories of two wheelers are manufactured and cleared as per specification and requirement of M/s HMIPL and M/s IYMPL on the price agreed upon between themselves and duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Accessory has been defined in McGraw Hill Dictionary of Scientific and Technical Terms, as follows: Accessory (Mech Eng): A part, sub-assembly or assembly that contributes to the effectiveness of a piece of equipment without changing its basic function, may be used for testing, adjusting, calibrating, recording or other purposes. Part (Eng) An element of a sub-assembly, not normally useful by itself and not amenable to further disassembly for maintenance purposes. The accessories are not cleared along with the motor vehicle at the time of their clearance from the manufacturer of Motor Vehicle . The buyer of two wheeler may or may not buy the same as it is his option. The accessories of two wheelers are not used on motor vehicles as they are an independent item. It cannot be used other than mere attachment for seating comfort or safety item. It is only an adjunct or accompaniment of two wheeler. Therefore even if it is assumed without admitting that such accessories fall under the category of parts or accessories of automobiles, it may at best be termed as accessory of automobile . Accessory of an automobile is not covered in the Not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Grip Handle, Front Guard Side, Grip Handle Side, Guard Leg, all these were imported through various ports across the country and all the above items were assessed to ad valorem duty as accessories of two wheelers and none of them were insisted to make payment of additional duties of customs as per MRP / RSP valuation even at Custom side. The same ratio would apply to central excise assessment also. Therefore, the contention of the revenue that the accessories of two wheelers manufactured by the appellants are parts of two wheelers and thereby resorting to valuation on MRP / RSP basis is bad in law. 5. In case of demand confirmed of ₹ 1,08,90,349/- on the ground that the goods were shown cleared for job work and the same were removed clandestinely he submits that for manufacture of accessories, they require MS Tubes, SS strips, MS Rods, SS Rods, Coating Powders, Plastic Bags, Gas for welding and the accessories are manufactured by carrying out the operations, development of designs, Cutting of MS Tubes, Bending of Rod / Pipes, Welding, Shot blasting, Power Coating (MS), Packing, he submits that the demand is without any basis . They do not have the facility ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inputs are removed as such. The inputs / semi finished goods which were removed under delivery challan were removed for job work were received back in the appellant s factory and then cleared on payment of duty by raising invoices to the ultimate buyers. Therefore, the demand of ₹ 45,56,578/- is not legal. 7. As regards the confiscated goods wherein duty of ₹ 75,976/- has been demanded, he submits that the said goods were covered under invoice no. 55 dated 02.12.2013 and invoice no. 56 dated 04.12.2013, pending clearance from the factory after proper packing and were lying inside the factory premises only at the time of seizure. The goods which were properly accounted for and still lying within the factory of manufacture are not liable for confiscation and therefore, the detention and consequent seizure and demand of duty on the same is not at all sustainable. In view of above, he submits that the impugned Order being devoid of merits is liable to be set aside. In respect of appeal filed by the revenue for the subsequent period wherein demand on goods in terms of Section 4A and Notification No. 49/2008 was held to be not sustainable, he supports the fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t does not bear such details, hence the goods cannot be termed as wholesale package. The Board vide circular No. 625/16/2002-CE dated 28.2.2002 clarified that in case of dispute regarding requirement of declaring RSP, clarification should be obtained from the Metrology Dept or the State Govt. However, the Metrology Dept could not provide any clarification in absence of wrapper / package, but opined that wholesale packages are exempted from declaration of RSP in views of Rule 24 of LMPCR- 2011. Thus, the adjudicating authority could not obtain a definite view of the Metrological department on the issue. The general opinion of the Metrology Department is extraneous and has no bearing. 9. He also submits that the demands against the Appellant in respect of Order-in-Original dated 23.01.2015 has also been raised as the Appellant cleared semi finished goods and inputs on challan to job workers but the same were not received back. Also the demand of ₹ 75,976/- is sustainable as the goods were not accounted for in the stock records but were to be removed under invoices. He also supports the confiscation of said goods on the same ground. In regard to other demands he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and safety of the vehicle as well as of the rider. In Notification No. 49/2008-CE (NT) dated 24.12.2008, as amended by notification No. 9/2010-CE(NT) dated 27.02.2010, the Sr. No. 108 reads, as under : (1) (2) (3) (4) 108 Any chapter Parts, components and assemblies of vehicles (including chassis fitted with engines) falling under Chapter 87 excluding vehicles falling under headings 8712, 8713, 8715 and 8716 30 12. We find that the above Notification covers parts, components and assemblies of vehicles, whereas looking to the use of the impugned goods, they are neither parts or components or assemblies of vehicle as they are not required in the functioning of the two wheelers. Only for the reason that the Tariff Entry 8714 covers parts and accessories of vehicles, it cannot be said that the parts and accessories are one and the same. Both the terms denote a separate meaning. Whereas the term parts means a piece of segment of something w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the product whose name it carries but it does not make it a part of the motor vehicle on this ground. Heading 39.26 specifically covers articles of plastics and as it is not in dispute that the impugned goods have been made of plastics they would be classifiable under heading 39.26 only. 13. It is apparent from the above that there is clear difference between the parts and accessories and they cannot be equated with each other. Section 4A of the Central Excise Act, 1944 covers only those excisable goods which are required to declare the retail sale price under the provisions of legal Metrology Act, 2009. Even if the goods are presumed to be listed under Notification 49/2008, the same would not be covered under the provisions of Section 4A of the Central Excise Act, if these are not covered by the provisions of the legal Metrology Act, 2009 and the Rules framed therein. As per provisions of the Legal Metrology Act, 2009 and the Legal Metrology (Packaged Commodities) Rules, 2011 (LMPCR), to the goods manufactured and cleared by the Appellant, the term retail package is defined at Rule 2 (j)(i) of the LMPCR, 2011 to mean: packages which are i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he goods in bulk pack, wherein per box includes 5 / 6/ 10 pieces per box. It is, thus, absolutely clear that the goods when cleared by the Appellant are not intended for retail sale at the end of M/s RC. 15. It is also a fact appearing on record that when the Revenue sought opinion from the Controller, Legal Metrology Director Consumer Affairs, Gandhi Nagar, the said agency vide letter No.CLM/4554 dated 24.4.2014, even though could not give a report for want of wrapper / package had opined that as per Chapter 3, Rule 24 of the Package Commodity Rule, 2011, retail sale price is not required to be declared on the wholesale package, as defined in the said rules. It is a fact that the buyers of the goods are opening the bulk pack cleared by M/s RC and putting MRP on the same as well as repacking these goods, if required. The said activity of packing / repacking as well as labelling / re-labelling amounts to manufacture in terms of Section 2 (f) (iii) of the Central Excise Act, 1944 and they are liable to pay central excise duty in terms of impugned notification and provisions of Section 4A. The goods cleared by M/s RC are neither a retail pack nor are meant for retail ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hority has held that some of the goods were cleared under job work to M/s Bapa Sitaram which is an ice factory and it is not possible to do job work as no activity can be undertaken at ice factory. Further that some goods were cleared to Riddhi Industries which is owned by daughter of proprietor of M/s RC. Also that act of raising challans without full address gives rise to suspicion and that there were some job workers who did not have entries against their name in ledger books of RC. Similarly in case of demand of ₹ 48,46,578/- the adjudicating authority has held that the inputs has been cleared without reversal the amount equal to credit or without payment of duty under the cover of delivery challans and the same is recoverable. We find that the show cause notice and the impugned order has proceeded to demand aforesaid amounts only on the basis of delivery challans holding that the challans were incomplete and that the goods were cleared for job work but were not returned to the factory. We find that M/s RC has cleared semi finished goods or inputs under challans for job work which is an undisputed fact. The show cause notice has not adduced single evidence that the goods ..... X X X X Extracts X X X X X X X X Extracts X X X X
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