Case Law Details
Commissioner of Central Excise Vs Bata India Limited (CESTAT Kolkata)
CESTAT Kolkata held that central excise duty demand not sustainable as there was no under-valuation in the costing of the product i.e. footwear components.
Facts- The appellant manufactured and removed footwear components for use within the factory and in their own factories at other places as well as for use by their job workers for manufacture of complete footwear. They did not make proper determination of assessable value of the said goods in terms of Section 4 of the Central Excise Act, 1944 read with Central Excise (Valuation) Rules, 1975 for the period of April’1996 to August’ 1998. It was observed that they undervalued the footwear components cleared for consumption in other units and in the factories of job workers. A Show Cause notice was issued to the appellant proposing to recover Central Excise Duty along with penalty under Sec.11AC and interest under Sec.11AB of the Central Excise Act, 1944 invoking extended period of limitation in terms of proviso to Section 11A ibid.
Conclusion- Held that the Appellant has already paid duty on the basis of the cost arrived at based on the method cited above. Thus, we find that there is no under-valuation in the costing of the product adopted by the Appellant. Accordingly, we hold that the demand does not survive. As the demand is not sustainable, the demand of interest and penalty also not sustainable.
Also held that as they have not suppressed any information from the Department, the demand made in the Notice by invoking extended period under proviso to Section 11A is not sustainable. We find merit in the argument of the Appellant. However, since we have already held that on merit itself the demand is not sustainable, we are not going into the issue of Limitation further.
Please become a member. If you are already a member, login here to access the full content.
Author Bio
