Case Law Details
Senor Metals Pvt Limited Vs Commissioner of Central Excise & ST (CESTAT Ahmedabad)
Introduction: In the case of Senor Metals Pvt Limited vs. Commissioner of Central Excise & ST (CESTAT Ahmedabad), the demand of customs duty was confirmed for manufacturing dutiable goods on job work basis without disclosing the verification report. The Central Excise Tariff Act, 1985, and various notifications, including 214/86-CE and 22/2003-CE, were invoked in the matter. The CESTAT Ahmedabad order directed re-adjudication, raising questions on principles of natural justice and violation of show cause notice.
Analysis: The case revolves around Senor Metals Pvt Limited, engaged in manufacturing brass articles, and its activities related to job work basis and dutiable goods. The Revenue argued that the appellant failed to comply with Rule 6(2) or 6(3) of the Cenvat Credit Rules, 2004, and didn’t maintain separate accounts for inputs used in dutiable goods and exempted goods. A show cause notice was issued, demanding recovery of Rs. 2,29,73,314 under Rule 6(3) of the Cenvat Credit Rules, along with interest and penalty.
The learned Commissioner adjudicated the matter, dropping some demands but confirming others. The appellant challenged the scope of the show cause notice and the violation of principles of natural justice. The verification report, on which the demand was based, was not provided to the appellant, raising concerns over procedural fairness. CESTAT Ahmedabad set aside the order-in-original and remanded the matter for de-novo adjudication.
Conclusion: The CESTAT Ahmedabad order highlights the complexities of duty demands and the significance of adhering to show cause notice and principles of natural justice. The case raises pertinent questions about compliance and procedural fairness in customs duty matters. The re-adjudication will be crucial in resolving the issues and providing clarity on the applicability of various notifications in the context of the appellant’s job work and dutiable goods activities.
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