The case involved a dispute over the valuation of power units ...

CESTAT ruled in favor of the appellant regarding undervaluation of power units supplied. Duty & interest recalculated beyond time limit. Penalty not sustainable.

Case Laws     Central Excise

June 10, 2024

The case involved a dispute over the valuation of power units supplied by one party to another, leading to a demand for differential duty, interest, and penalty. The appellant undervalued components supplied, resulting in undervaluation of the power units. The appellant's argument that they were not liable to pay duty under a different rule was rejected as they had chosen a specific duty payment procedure. The recalculation of interest was found to be time-barred under Section 11A. The penalty imposed under Section 11AC was deemed unsustainable as duty determination under Section 11A was lacking. The decision was in line with the Supreme Court's ruling that penalty under Section 11AC applies only after a duty determination under Section 11A. The appeal was allowed in favor of the appellant by the CESTAT.

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