Case Law Details
Parvatiya Plywood Private Limited Vs Commissioner (CESTAT Delhi)
CESTAT Delhi held that as the appellant bonafidely, in view of their claim of Area based exemption, didn’t collected central excise duty, they are entitled to benefit of recalculation of demand on cum-duty basis as per explanation to section 4(1)(b) of Central Excise Act.
Facts-
The issue involved in these appeals was whether the appellant is entitled to ‘Area based exemption’ under exemption Notification No. 49/2003-CE dated 10.06.2003 r/w subsequent Notification No. 50/2003-CE (as amended). In the miscellaneous order dated 19/05/2022, the Tribunal recorded the submission of the appellant, that the main issue of exemption has been decided against the appellant by the Supreme Court in the similar matter for the other period.
It is urged that the appellant was under bona fide belief that they will be entitled to the Area based exemption, as other units and /or similar units in the same locality were enjoying the Area based exemption. Accordingly, this appellant had also claimed the exemption and did not charge excise duty from their customers at the time of clearing the goods. The learned Counsel demonstrates this fact from sample invoices which have been annexed to appeal paper book. Under the circumstances, as the appellant has to pay the excise duty out of their own pocket and admittedly they did not collect the excise duty, it is urged that the demand of duty may be directed to re-quantified by extending benefit of ‘cum-duty value’ and also the benefit of Cenvat credit on inputs/ input service, as may be available to the appellant.
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