Case Law Details
Contacare Ophthalmics and Diagnostics Vs Commissioner of Central Excise & ST (CESTAT Ahmedabad)
A recent ruling by the CESTAT Ahmedabad sheds light on the applicability of the larger limitation period concerning de-bonding post-verification and issuance of a no dues certificate.
The case revolves around Contacare Ophthalmics and Diagnostics, a 100% EOU seeking de-bonding approval in 2011. Despite paying duties and receiving a no dues certificate, a Show Cause Notice (SCN) was issued in 2015, demanding differential duty. The primary contention was the incorrect calculation of duty by the Principal Commissioner. The appellant argued that the duty was wrongly calculated based on local Maximum Retail Price (MRP) instead of the transaction value as per the Customs Act 1962, leading to an erroneous demand.
Furthermore, the SCN was issued under Section 11A (5) of the Central Excise Act 1944, which stood omitted in 2015. Additionally, the larger limitation period was deemed inapplicable due to prior verification and issuance of a no dues certificate.
The appellant’s submission highlighted errors in duty calculation, emphasizing the incorrect assessment of Basic Customs Duty (BCD), Countervailing Duty (CVD), and Education Cess. As per the Proviso to Section 3(1) of the Central Excise Tariff Act, duty should be calculated based on the transaction value, not the MRP.
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