Commissioner of Central Excise Vs J K Tyre Industries Ltd. (Karnataka High Court)
Karnataka High Court held that the provisions of Rule 7 of the Central Excise Rules and Section 12B of the Central Excise Act are not applicable in cases of provisional assessment. Accordingly, appeals of revenue stand dismissed.
Facts- The respondent-assessee is engaged in the manufacture of tyres. Three of its units cleared goods to the depots on provisional assessment under Rule 7 of the Central Excise Rules, 2002, on the ground that the value of the goods was not ascertainable at the time of removal. Upon finalization of the provisional assessment, adjustment of short-paid and excess- paid duty was sought. The Adjudicating Authority held that the incidence of duty had been passed on to the ultimate customers and, therefore, the assessee was not entitled to netting off or adjustment of excess payment against the duty short-paid. Commissioner (Appeals), by order dated 01.02.2018, rejected the contentions of the assessee and upheld the view of the Adjudicating Authority.
CESTAT, following its earlier order in the assessee’s own case, held that where provisional assessment is made, Section 12B of the Act and Rule 7 of the Rules are not applicable. The Revenue has called in question the said orders of the CESTAT in these appeals.
