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TMI Blog2023 (9) TMI 1133X X X X Extracts X X X X X X X X Extracts X X X X ..... OPAL [ 2016 (7) TMI 1104 - CESTAT NEW DELHI] . As in the matters in hand, the appellants were paying duty in terms of Notification No.16/2010-CE(NT) dated 27.02.2010 read with Rule 10 of Chewing Tobacco Unmanufactued Tobacco Packing Machines (Capacity Determination Collection of Duty) Rules, 2010, therefore, the appellant paid correctly and no further duty is payable by the appellant on the basis of actual production, which was found higher than the deemed annual capacity of production. The said machine shall be considered as duplex single track line machine and no further duty is to be demanded from the appellant. There are no merits in the impugned orders and the same are set aside - appeal allowed. - HON BLE SHRI ASHOK JINDAL , MEMBER ( JUDICIAL ) And HON BLE SHRI K. ANPAZHAKAN , MEMBER ( TECHNICAL ) Shri Rahul Tangri Ms. Udita Saraf, both Advocates for the Appellant (s) Shri S.Mukhopadhyay, Authorized Representative for the Revenue ORDER Per : ASHOK JINDAL : All the appeals are having common issue therefore all are disposed of by a common order. 2. The facts of the case are that the appellant is engaged in the manufacture of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 18.10.2012 for the relevant period. 8. The abovementioned SCN was issued on the allegation that the Appellant had manufactured and cleared goods in excess of the production capacity as determined by the Assistant/Deputy Commissioner of Central Excise in terms of Rule 5 of the Notification. Thus, duty demand was proposed on the actual production of goods, which was used to arrive at number of machines mathematically required (disregarding the actual machines installed and operated during the relevant period) to manufacture the same on the basis of deemed production capacity under Rule 5. Such notional number of machines,mathematically arrived at,was multiplied with the rate of duty per machine as per Notification NO. 16/2010 to arrive at the duty demand. 9. The above demand was consequently confirmed by the Ld. Commissioner of Central Excise on the ground that the Appellant had deliberately produced and cleared goods more than the determined capacity. Further, with respect to Excise Appeal No. E/75041/2014and E/75042/2014, as a corollary to the computation of demand, it is also observed that as per Explanation to Rule 5 of the Rules, merely number of operating machines instal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in pouches. The factor relevant to the production on which excise duty is leviable has been notified to be the number of packing machines in the factory of the manufacturer under the Pan Masala Packing Machines (Capacity Determination and Collection of Duty) Rules, 2008 and the Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rules, 2010 read with section 3A(2) and (3) of the Central Excise Act, 1944. The monthly deemed production per operating machine per month is prescribed based on the average speed of packing machines and average working hours of a factory. Excise duty is chargeable at the rates notified on the basis of Retail Sale Price (RSP) slabs on per machine basis (notification No. 42/2008- C.E., dated 1-7-2008 and notification No. 16/2010-C.E., dated 27-2- 2010 refer). In order to minimize the element of subjectivity and to ensure certainty and objectivity, the number of packing machines installed in the factory has been notified to be the only factor relevant to the production of the notified goods under the said rules. 5. Accordingly, it is clarified that the duty payable under notification No. 42/2008-C. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quantity of production, are not correct and hence not sustainable under the law. 14. As in the matters in hand, the appellants were paying duty in terms of Notification No.16/2010-CE(NT) dated 27.02.2010 read with Rule 10 of Chewing Tobacco Unmanufactued Tobacco Packing Machines (Capacity Determination Collection of Duty) Rules, 2010, therefore, the appellant paid correctly and no further duty is payable by the appellant on the basis of actual production, which was found higher than the deemed annual capacity of production. 15. Further, we find that in Appeal Nos.75041 75042 of 2014, the issue has been raised by the adjudicating authority that merely number of operating machines installed in the factory during the month is not the criteria for determining capacity of production but also number of track or line on the machine and if a packing machine has more than one track or line, then each such track shall be deemed to be one individual packing machine. Since, in the present case, then each packing machine is producing almost twice the quantity, as determined by Assistant Commissioner, therefore irrespective of the fact that the machine of the appellant is single t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s a result of which two pouches are formed, filled and sealed resulting in much higher speed of production of pouches. This is clear from the report dated 15-10-2010 of IIT Professor Shri S. Sanghi of Applied Mechanical Department and Professor Shri S. Mukherjee of Mechanical Engineering Department of IIT, Delhi. This report also clearly classifies the machine, in question, as a single track duplex machine. In our view there is absolutely no basis for the Commissioner s finding that it is a multiple track machine. Just because the speed of this machine is much higher than the normal machines, it cannot be treated as a multiple track machine. And the said order has been affirmed by the Hon ble Allahabad High Court as reported in the case of Commissioner of Central Excise v. Dharampal Satyapal Ltd. [2016 (333) E.L.T. 283 (All.)] and the said order has been accepted by the department. 16. In that circumstances, we hold that the said machine shall be considered as duplex single track line machine and no further duty is to be demanded from the appellant. 17. In view of this, we do not find any merits in the impugned orders and the same are set aside and appeals are allowed w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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