M/S Annakut Biscuit Co. Pvt. Ltd vs Cce & St, Allahabad

[Arising out of the Order-in-Appeal No. 224 to 229/CE/APPL/KNP/ 2012 dated 31/07/2012 passed by The Commissioner of Central Excise, Kanpur.]

For Approval and signature :

Honble Shri Rakesh Kumar, Member (Technical)

Honble Shri S.K. Mohanty, Member (Judicial)

1. Whether Press Reporters may be allowed to see :

the Order for publication as per Rule 27 of the

CESTAT (Procedure) Rules, 1982?

2. Whether it would be released under Rule 27 of :

the CESTAT (Procedure) Rules, 1982 for

publication in any authoritative report or not?

3. Whether their Lordships wish to see the fair :

copy of the order?

4. Whether order is to be circulated to the :

Department Authorities?

M/s Annakut Biscuit Co. Pvt. Ltd. ] Appellant

Shri Naveen Khanna, Director ]

Versus

CCE & ST, Allahabad Respondent

Appearance

Shri M.H. Patil, Advocate  for the Appellants.

Shri R.K. Grover, Authorized Representative (DR)  for the Respondent.

CORAM : Honble Shri Rakesh Kumar, Member (Technical)

Honble Shri S.K. Mohanty, Member (Judicial)

Final Order No. 50721-50722/2015 Dated : 03/03/2015

Per. Rakesh Kumar :-

The appellant are manufacturers of biscuits including cream biscuits. The biscuits of MRP not exceeding Rs. 100/- per kg. are fully exempt from duty under Notification No. 3/06-CE dated 01/3/06 (Sl. No. 18A). For manufacture of one type of such biscuits  Elaichi cream and Orange cream biscuits the appellant also prepare an intermediate product  Elaichi Cream and Orange Cream. Since the biscuits in the manufacture of which the cream was being used are fully exempt from duty, the Department was of the view that the Elaichi Cream and Orange cream, the intermediate product, would not be exempt from duty. It is on this basis that two show cause notices were issued to the appellant company for demand of duty in respect of clearances of Elaichi cream and orange cream manufacture by the appellant for captive use during the period from May 2007 to February 2008 and March 2008 to September 2008. The total duty demanded under these show cause notices by classifying the Elaichi cream/orange cream under Tariff Heading 2106.90 of the Tariff is Rs. 55,85,477/-. The show cause notices also demanded the interest under Section 11AB as the duty and sought imposition of penalty on the appellant company as well as its Director Shri Naveen Khanna.

The show cause notices were adjudicated by the Additional Commissioner by a common order-in-original dated 01/2/12 by which the Additional Commissioner holding the Orange cream and Elaichi cream as marketable excisable goods classifiable under sub-heading 2106.90, confirmed the above-mentioned two duty demands alongwith interest under Section 11AB and beside this, imposed penalty of Rs. 9,50,000/- on Shri Naveen Khanna, Director of the appellant company. No penalty was imposed on the appellant company under Section 11AC. Against this order of the Additional Commissioner, the appellants filed appeal before the Commissioner (Appeals). The Commissioner (Appeals) decided these two appeals alongwith appeal filed by other appellants namely M/s Rishi Bakers by a common order-in-appeal dated 27/7/12. In this order the Commissioner (Appeals), however, discussed the excisability of only the sugar syrup and the question of demand of duty on it, which was the issue involved in respect of appeal filed by M/s Rishi Bakers; but the issue involved in the appeal filed by M/s Annakut Biscuits Co. Pvt. Ltd. was not discussed.

The Commissioner (Appeals) dismissed the appeals. Against this order of the Commissioner (Appeals), these two appeals have been filed by the appellant company  M/s Annakut Biscuits Co. Pvt. Ltd. and Shri Naveen Khanna, Director.

2. Heard both the sides.

3. Both the sides agree that while the issue involved in the appeals filed by the appellants in this matter is regarding the classification of the Orange cream and Elaichi cream and its marketability, and hence excisability, the Commissioner (Appeals) has not gone into this question at all, but has only gone into the question of classification of sugar syrup and its marketability/ excisability. In view of this, the impugned order passed by the Commissioner (Appeals), in so far as it relates the appellant in this case, is set aside and the matter is remanded to the Commissioner (Appeals) for fresh decision after hearing the appellant. In the denovo proceeding the Commissioner (Appeals) should give specific finding on the question of the classification of the orange cream and Elaichi cream and also the question on its marketability and excisability and other issues which may be raised. The appeals stand disposed of, as above.

(Dictated and pronounced in open court.)

(Rakesh Kumar)

Member (Technical)

(S.K. Mohanty)

Member (Judicial)

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