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TMI Blog2019 (8) TMI 1910X X X X Extracts X X X X X X X X Extracts X X X X ..... ince all the three goods are supplied through a pipeline, the SKO get mixed with either MS or HSD. As per the provisions of Section 4, the excise duty is payable on the transaction value at the time of removal of the goods from the factory. In the present case, the goods cleared from the factory is MS/HSD and SKO. Accordingly, the duty on these products is payable as per price of the respective product prevailing at the time of removal of the goods. As regards MS and HSD, the duty was paid on the transaction value. As regards SKO, since the same was not sold, the duty was paid on the prevailing price of SKO on the basis of sale price prevailing for SKO naturally which is higher than the price of SKO sold under Public Distribution Systems. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Third schedule. For this reason, intermixing of SKO with HSD/MS does not amount to manufacture. The differential duty demand raised on interface quantity of SKO is clearly not sustainable. Hence, the impugned orders are set aside and the appeals filed by the appellant are allowed. - HON BLE SHRI P.K.CHOUDHARY, MEMBER (JUDICIAL) and HON BLE SHRI BIJAY KUMAR, MEMBER (TECHNICAL) Shri Chandan Kumar, DGM Finance for the Appellant (s) Shri S. S. Chattopadhyay, A. R. for the Respondent(s) PER SHRI P.K.CHOUDHARY: The appellant/applicant has file Misc. application for out of turn hearing of their Appeal No. E/79107/2018-DB. The Ld. Representative of the appellant company submits that there are more appeals on the self-same issue listed today. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty payable on SKO not used for intended purpose and duty payable on surge/gain of MS or HSD shall be payable for intermixed / interfaced quantity. Accordingly, the duty of intermixed part of SKO and MS/HSD as the case may be, should be quantified and higher of the two is payable. The Adjudicating Authority in the adjudication confirmed the demand of differential Central Excise duty with interest and also imposed penalties. Therefore, the present appeals. 3. Shri Chandan Kumar, DGM (Finance) of the appellant company appeared and submitted that the entire demand was confirmed on the basis of the Board Circular. He submits that the Board Circular is not supported by any statute; therefore, the same is not binding on the assessee. He submits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tment were set aside. 5. Shri K. Chowdhari appearing for the Revenue/respondent reiterates the finding of the impugned orders. 6. We have carefully considered the submission made by both the sides and perused the appeal records. 7. We find that the fact is not in dispute that while clearing the goods, the appellant has cleared from the factory quantities of MS, HSD SKO separately. Since all the three goods are supplied through a pipeline, the SKO get mixed with either MS or HSD. As per the provisions of Section 4, the excise duty is payable on the transaction value at the time of removal of the goods from the factory. In the present case, the goods cleared from the factory is MS/HSD and SKO. Accordingly, the duty on these products is payabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ethod of pumping and in such an event, co-mingling of one product with another is inevitable. The case of the oil company is that shortage of SKO imported under concessional rate of duty is accounted for in terms of the interface quantity i.e. the gain in Motor Spirit (MS) High Speed Diesel (HSD) and the duty paid by them on this interface quantity is more than the duty foregone on SKO on account of concessional rate of duty. Therefore, as per the assessee, the question of additional duty liability does not arise. The Board has examined the issue from the twin objectives of safeguarding revenue as well as avoiding unnecessary litigation. The existing instructions vide Board s letter F. No. 21/13/66- CX.III, dated20.03.67 and F. No. 11A/9/70 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ued contrary to the statutory provisions. We refer some of the judgements on this issue : a) 2008 (229) ELT 641 (SC) Sindur Micro Circuits Limited Vs. CCE, Belgaum. b) 2009 (235) ELT 385 (SC) Atul Commodities Pvt. Ltd. Vs. CCE, Cochin. c) 2003 (156) ELT 819 (Bom) NarndraUdeshi Vs. UOI d) 2015 (326) ELT 26 (SC) DGFT Vs. Kanak Exports. 9. In view of the above judgements, it is clear that the Board can only clarify the existing law but cannot create law by itself. Therefore, the above Board Circular dated 22.04.2002 having without having support of any Act or Rule, is not binding on the assessee. 10. As regards the issue that after removal of goods, intermixing of SKO with MS/HSD amounts to manufacture, we find that there is no charge in the S ..... X X X X Extracts X X X X X X X X Extracts X X X X
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