Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | 57A Central Excise Act 1944 rr. 7 s.4/Cent~al Excise Rules |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Allowed |
Headnote | Central Excise Act, 1944; s.4/Central Excise Rules, 1944; rr. 7, 57A and 57CC/Central Excise Tariff Act, 1985; Chapters 47 and 48/Central Excise (Valuation) Rules, 1975; r. 6(b) and Circular No.B-42/1/96 - TRU dated 27.9.1996 issued by CBEC: Evasion of excise duty - Assessee manufacturing pulp and paper - No excise duty chargeable - Availing of MODVAT credit on pulp - Assessee transferring part of stock of pulp as inputs to its sister units for captive consumption in manufacturing of paper - Payment of duty @8% of cost price instead of sale price by the assessee - Show-cause Notices - Revenue raising demand of differential amount of duty computing excise duty @8% on sale price chargeable on reversal of MODVAT credit - Challenge to - Tribunal held that there was no sale of pulp by the assessee - On appeal, Held: Show cause notice constitute foundation in cases of alleged evasion of the excise duty - Rule 57CC applies where manufacturer engaged in manufacturing of the goods exempted from payment of duty and credit on the inputs used in manufacturing of such goods was taken by the assessee - Assessee required to pay a presumptive amount equal to sale price of the exempted final product - It brings into applicability of Section 4 of the Act and Valuation Rules framed thereunder - Tribunal erred in holding that R.57CC not applicable as it involves stock transfer and not a sale - Hence, matter remitted to Revenue to decide the question of applicability of Rules 6(b)(i) and 6(b)(ii) of the Valuation Rules in accordance with law. Show-cause Notices - Invoking of extended period of limitation - Held: Revenue not entitled to invoke extended period of limitation in respect of first show-cause Notice which was time-barred - However, second and third show-cause Notices remitted to Revenue to decide about applicability of r.6(b) and (ii) - Since r. 7 of the Rules not mentioned in show-cause Notices, it is not open to Revenue to invoke the said rule.Words and Phrases: 'Normal price' - Meaning of in the context of Section 4(1) of the Central Excise Act, 1944. 'Presumptive sum' and 'deemed price' - Meaning of in the context of Rule 57CC of the Central Excise Rules, 1944. The issue which arose for determination in this appeal was that in the absence of sale of the goods manufactured by the assessee, part of which was being transferred to its sister unit for captive consumption in manufacturing the final product, which is exempted from payment of excise duty, MODVAT credit on input was availed by the assessee, however on reversal of credit, duty was paid on the cost price instead of the sale price. Under the circumstances, whether rule 57CC of the Central Excise Rules, 1944 would have any application or not, is the question. |
Judge | Honble Mr. Justice S.H. Kapadia |
Neutral Citation | 2007 INSC 887 |
Petitioner | Commissioner Of Central Excise, Nagpur |
Respondent | M/s. Ballarpur Industries Ltd. |
SCR | [2007] 9 S.C.R. 650 |
Judgement Date | 2007-08-30 |
Case Number | 1373 |
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