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TMI Blog2023 (9) TMI 717X X X X Extracts X X X X X X X X Extracts X X X X ..... e officers. If the audit points out some wrong assessment which was not pointed out by the officer scrutinising the ER-1 return, the fault lies at the doorstep of the officer. It does not, by itself, establish that the assessee had suppressed any facts. Revenue Neutrality - HELD THAT:- Revenue neutrality is a concept which has evolved through a series of decisions only for the limited purpose of determining if the assessee could have had an intention to evade payment of duty. This intention is an essential ingredient to invoke extended period of limitation. If it is Revenue neutral situation where, the excess duty, if paid, would have been available to the appellant itself or its another unit or a related unit as CENVAT credit, there cannot be an intention to evade because the assessee would gain nothing by evading - Beyond the limitation, Revenue has no remedy although the charge remains. It is like a time-barred debt which, though owed, cannot be recovered by the creditor. If differential duty was chargeable but was not paid and it is later discovered by audit and it gets time barred under Section 11A, the responsibility for it rests squarely on the officers mandated to scru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operative part of which is as follows; ORDER i. I reject the assessable value of 'Waste Rubber Granules (Patta) and Waste Rubber Granule (RD), declared by the noticee, M/s Gripsurya Recycling LLP in their invoices and as detailed in para 2.1 of the Show Cause Notice dated 27.07.2020 and order to determine the assessable value of the said excisable goods under the provisions of Section 4(1)(b) of the Central Excise Act, 1944 read with the provisions of Rule 10 and Rule 9 and Rule 8 of the Valuation Rules, 2000; ii. I confirm the demand of Central Excise duty of Rs.8,29,928/- (Rupees Eight lakh twenty nine thousand nine hundred twenty eight only) (inclusive of Education Cess Secondary and Higher Education Cess) for the period April 2016 to June 2017 as detailed in para 2.1 of the show cause notice dated 27.07.2020, under Section 11A(4) of the Central Excise Act, 1944 and order to recover the same from the noticee, M/s Gripsurya Recycling LLP, Plot No. S-4, Sector-III, Pithampur, Dhar, Madhya Pradesh; iii. I order to recover interest on the above confirmed demand of Rs.8,29,928/- (Rupees Eight lakh twenty nine thousand nine hundred twenty eight only) from the not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the imposition of penalty under section 11AC. 7. The reasons mentioned in the SCN for invoking extended period of limitation are: (i) undervaluation of manufactured goods by the appellant resulted in short payment of duty; (ii) Even after audit pointed out, the appellant resisted the proposition by the audit and justified its method of valuation which shows its intention; and (iii) Had the audit not scrutinized the returns, the undervaluation would not have come to light. 8. The order-in-original asserted that the appellant and GRP were related persons and it dismissed the plea of the appellant that the exercise is revenue neutral. It reasoned that simply because the buyer would have been eligible for CENVAT credit is not a ground to not pay Central Excise duty and if the duty has to be paid on a value it should be paid and whether the buyer will get CENVAT credit or not is irrelevant for the purpose of raising the demand. It further stated that from the periodical returns filed by the assessee, the department could not come to know about the details of the buyers to whom the goods were sold and if they were related. The assessee is required to correctly determine the dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nue neutrality does not mean that the appellant can escape paying duty when it is to be paid as per law. 13. We have considered these submissions. That the appellant had contested the observations of the audit cannot be a ground to presume wilful suppression of facts. Nothing in the law requires the assessee to accept the views of audit team or preventive team or any other team of officers. Therefore, this submission of the Revenue cannot be accepted. 14. The second contention of the Revenue is that it was for the appellant to have correctly assessed the duty and filed ER1 returns and from the returns filed by the appellant it was not clear that it had sold to related persons. This submission also cannot be accepted. 15. Firstly, there could be two or more views on the same issue and the assessee self-assesses duty as per its view and understanding. 16. Secondly, the ERI Returns are not designed by the assessee but by the department under the Rules and the obligation of the appellant is to disclose information in them. If the ER 1 returns are defectively designed and do not have columns requiring the assessee to disclose its relationship with its buyers, the assessee ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ral Excise a monthly return in the form specified by notification by the Board, of production and removal of goods and other relevant particulars, within ten days after the close of the month to which the return relates Xxxxxxx (3) The proper officer may on the basis of information contained in the return filed by the assessee under sub-rule (1), and after such further enquiry as he may consider necessary, scrutinize the correctness of the duty assessed by the assessee on the goods removed, in the manner to e prescribed by the Board. (4) Every assessee shall make available to the proper officer all the documents and records for verification as and when required by such officer. xxxxxx 18. Thus, the scheme under the law is that although the duty is levied on manufacture of goods, it becomes payable only when they are removed and it must be paid as per self-assessment by the fifth or sixth of the following month. The assessee also has to file returns. Needless to say that the assessee may make mistakes in self-assessment and the check against such mistakes has been provided in the form of scrutiny of the returns by the officers and the officer scrutinising the ret ..... X X X X Extracts X X X X X X X X Extracts X X X X
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