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TMI Blog2024 (10) TMI 1459X X X X Extracts X X X X X X X X Extracts X X X X ..... r on this aspect which has been followed even in number of cases as cited (supra) and which concludes that absence of provision relating to demand of duty in case of change of MRP and from whom for the period 01.03.2008 is fatal to the Revenue s case. In view of consistent decisions of this bench this court is inclined to follow the aforesaid decisions in this case also and holds that the lack of provision at the relevant time goes against the Revenue. This court also finds that the case law cited by the learned Advocate cited above that if there is no demand of duty there cannot be any imposition of penalty and fine is relevant for setting a side penalties. The appeals filed by the appellants are therefore, liable to succeed and same are allowed with consequential relief. - HON'BLE MEMBER ( JUDICIAL ) , MR. SOMESH ARORA Shri. Devashish K Trivedi , Advocate for the appellant Shri Sanjay Kumar , Superintendent ( AR ) for the Respondent ORDER SOMESH ARORA The brief facts of the case are as under : Both these appeals are filed against Common Order-in-Appeal No. 75 to 76/2010 (Ahd-III)KCG/CE/Commr(A) dtd. 12/03/2010 issued on 18/03/2010. Vide the said common Order-in-Appeal, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eclaring correct MRP. Therefore, these goods were liable for confiscation under sub Section (4) of section 11A of the Central Excise Act, 1944 and Rule 25 of Central Excise Rules, 2002. For the same reasons, according to the Show-cause Notice, M/s. Shah Tiles was liable for penalty under Rule 25 of the Central Excise Rules, 2002 and Mr. R. Kumar, Managing Partner of M/s. Aravind Ceramics, Chennai, was liable for penalty under Rule 26 of Central Excise Rules, 2002. 1.5. Period in dispute in this case is prior to 28/02/2008. On perusing panchnama annexed at page 77 to 99 of appeal No. E/957/2010 being filed by M/s. Shah Tiles Pvt. Ltd. and page 67 to 89 of appeal No. E/1214/2010 being filed by Mr. R. Kumar, it would be found that the panchnama under which goods were seized from the premises of M/s. Aravind Ceramic is dtd. 11/02/2008. Needless to mention that goods were cleared from the factory of M/s. Shah Tiles Pvt. Ltd. much prior to 11/02/2008, otherwise it would not have been seized on 11/02/2008 from the premises of the said dealer. 1.6. It is observed that many tiles cleared from number of manufacturers and supplied to M/s. Aravind Ceramic were seized from the premises of the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nner. It is also submitted that in absence of any relevant facts being brought on record, adverse inference ought to be drawn against the Revenue. It was submitted that Was the Revenue authorities did not bring on record that the MRP declared on the boxes of tiles cleared from the factory premises was altered by the appellants/manufacturer; that the dealers who had stated in the statements that there was sale of the tiles at a price higher than what was cleared from the factory premises. In continuation of such submission, it is further submitted that in the current scenario, it cannot be expected of any buyer/consumer purchasing a box of tiles wherein MRP is declared is Rs.100/- but the dealer/seller sells the goods for Rs.150/-; it would indicate that the boxes when sold to the customers, there was a change in MRP. It was also further submitted that in continuation of this proposition that despite making Pan India investigation, the DGCEI authorities were unable to seize even one carton of tiles which was cleared from the factory premises of the appellant wherein the declared MRP was changed and nor is there any evidence brought on record as to who changed the MRP. It is the subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any of the powers they have under the General Sales Tax law of the State; Section 3(3) of the Central Sales Tax provides that State Government may make rules not inconsistent with the provisions of the Act and rules made there under. The Uttar Pradesh State Government has framed Central Sales Tax (U.P. Rules) 1957, in exercise of the powers conferred under the CST Act, 1956, and Rule 9 of the said Rules provided that the provisions of Uttar Pradesh Sales Tax Act, 1948 and U.P. Sales Tax Rules, 1948 as amended from time to time or the rules made thereunder would apply to the dealer liable for assessment under Central Sales Tax Act and U.P. Sales Tax Rules, 1948, Rule 44(B) prescribed the manner of determining the turnover of the goods involved in execution of Works Contract. The relevant findings of the Apex Court were rendered on this factual aspect as contained in Para 27 of the judgment. In our considered view, the ratio decidendi from this judgment is that merely because the rules were not framed in Central enactment, it would not mean that no tax is leviable if rules have been framed under said enactment and there is a provision for referential incorporation of the said act in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is at higher MRP than the declared MRP of the dealers that they have sold the goods was any of the dealers as to who altered the RSP declared on boxes of glazed/vitrified tiles. In our considered view, this clinching evidence has not been recorded by the investigating authorities, for the reasons best known to them. If there would have been any evidence in any form as to who altered the RSP, then the duty, liability in our considered view, gets crystallized in the hands of such persons goods become manufactured goods; is the law which can be deduced from the provisions of Central Excise Act, 1944. In the absence of any evidence suggesting as to who altered the MRP on the boxes of tiles, we are of the view that the Revenue authorities cannot turn around and take a stand that the manufacturers are liable to duty, which would effectively mean that they are the persons who have altered the RSP. Yet another angle to the entire case is absence of evidence as to there being alteration of RSP; inasmuch as when the investigations were conducted by the authorities, we find that the investigating authorities have not seized a single carton of the offending goods in the Pan India operatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ck was assumed to be correct, even then the total consideration earned by the manufacturer even after including the other elements of cost, seems to not exceed the declared RSP at Morbi. This aspect, in our considered view, needs greater verification, if necessary, after granting, cross-examination especially in the light facts documents been recovered from the premises of third party who have not been made made noticee. If after going through the evidence and statements, it is felt that there is, in fact, evidence of extra cash consideration, then it will have to be seen whether the declared RSP at Morbi was proved to be false to the knowledge of manufacturer or not. If the declared RSP is found to be false to the knowledge of manufacturer at Morbi, then RSP will have to be determined in the manner prescribed in the rules which have been enacted w.e.f 1-3-2008, instead of being determined in any other manner. To that extent, we matter to the adjudicating authority for reconsideration of deter of determining, the RSP post-1-3-2008 as per the directions hereinabove and in accordance with law. The adjudicating authority will follow the principles of natural justice before coming to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11553, 11453-11457, 11448 11710/2014, 11190, 11189 13688/2013 twelve (12) appeals are decided. 1.13 Copies of all the aforesaid judgments are separately tendered before this Bench and these are : 1. Acme Ceramics V/s. Commissioner of Central Excise, Rajkot, reported at 2014 (304) E.L.T. 542 (Tri. - Ahmd.) 2. Acme Ceramics V/s. Commissioner of Central Excise, Rajkot, reported at 2014 (304) E.L.T. 588 (Tri. - Ahmd.) 3. Suzuki Ceramics V/s. Commissioner of C.EX. S.T., Rajkot, reported at 2016 (334) E.L.T. 169 (Tri. - Ahmd.) 4. Corrigendum dtd. 13/11/2014 in the matter of Kishorbhai Raghavjibhai Patel V/s.C.C.E. S.T., Rajkot 5. Commissioner of Central Excise, Rajkot, V/s. Pengvin Ceramics, reported at 2016 (335) E.L.T-774 (Tri. - Ahmd.) 6. Commissioner of Central Excise, Rajkot, V/s. Citizen Ceramic, reported at 2016 (339) E.L.T. 105 (Tri. - Ahmd.) 7. Order No. A/10644-10655/2015 dtd. 20/05/2015 in the matter of C.C.E. S.T. - Rajkot V/s. Opwell Ceramic Pvt. Ltd. 8. Order No. A/10938/2017 dtd. 09/05/2017 in the matter of Gladder Ceramics Ltd V/s. C.C.E. S.T.- Ahmedabad-iii. 1.14. Further, it was submitted that appeals against all these judgments are filed by the Department. The same wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Soaps V/S Commissioner of Central Excise, Mumbai 2014(312) .L.T. 253 (Tri. - Mumbai)- Commissioner of Central Excise, Raigad V/S Ispat industries Ltd 3. Learned AR defended the order and relied upon the following decisions of the Delhi bench of this Tribunal to justify the order :- Case No. 2011 (267) E.L.T. 101 (Tri-Delhi.) in the matter of Onida Saka Ltd. Case No. 2004(175) E.L.T. 225 (Tri. Del.) in the matter of M/s Hotline Wittis Display Devices Ltd. 4. This Court has considered the rival submissions and finds that there has been enough litigation as stated by the appellant and appeal of the department is pending in Supreme Court without stay. This Court also finds that the legal proposition about alteration of MRP as laid down in the case of Acme Ceramics Vs. Commissioner of Central Excise, Rajkot reported in 2014 (304) ELT 542 (Tribunal- Ahmedabad) is clear on this aspect which has been followed even in number of cases as cited (supra) and which concludes that absence of provision relating to demand of duty in case of change of MRP and from whom for the period 01.03.2008 is fatal to the Revenue s case. 4.1. In view of consistent decisions of this bench this court is inclined ..... X X X X Extracts X X X X X X X X Extracts X X X X
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