Mahanadi Coalfields Ltd. Vs Commissioner of CGST & Central Excise (CESTAT Kolkata)
The appellants, Mahanadi Coalfields Limited and its separately registered Area/Units, were engaged in production of coal. The proceedings concerned the assessable value of coal cleared during the period from March 2011 to February 2013 and, specifically, whether amounts collected towards “Royalty” and “Stowing Excise Duty” (SED) were required to be included in the transaction value for levy of Central Excise duty.
Nine Show Cause Notices were issued to eleven separately registered Area/Units of the appellant company for the common period from March 2011 to February 2013. The notices invoked the extended period of limitation and proposed recovery of Central Excise duty on Royalty and SED under the proviso to Section 11A(1)/Section 11A(4), together with applicable interest and equivalent penalty under Section 11AC of the Central Excise Act, 1944.
The learned Principal Commissioner, CGST & Central Excise, Ranchi, adjudicated the nine notices along with seven other identical notices issued to the appellant’s sister concerns, M/s Bharat Coking Coal Limited and M/s Eastern Coalfields Limited. By common Order-in-Original dated 18.08.2020, the demand, interest and equivalent penalty were confirmed. The Commissioner observed that Royalty and SED were not “taxes” and were therefore includible in the transaction value.
