M/S. Dinesh Tobacco Industries vs C.C.E. & S.T. Jaipur-Ii

[Arising out of Order-in-Appeal No.V(16)2/AE/JPR-II/2013/1007-1020 dated 14.03.2013 by the Commissioner of Central Excise, Jaipur-II].

For approval and signature:

Honble Mr Ashok Jindal, 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 should 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 Departmental authorities?

M/s. Dinesh Tobacco Industries .Appellants

Vs.

C.C.E. & S.T. Jaipur-II .Respondent

Appearance:

Shri O.P. Agarwal, DR for the Appellants

Ms. Ranjana Jha, Advocate for the Respondent

CORAM:

Hon'ble Shri Ashok Jindal, Member (Judicial)

Date of Hearing: 15.01.2015

FINAL ORDER NO.50109/2010-EX(SM)

Per Ashok Jindal:

The appellant is in appeal against the impugned order wherein the Ld. Commissioner has directed to pay duty as per ACDO. The facts of the case are that the appellant are manufacturing Sada Pan Masala as well as Zarda and they are being governed by Pan Masala Packing Machine (Capacity Determination and Collection of Duty) Rules 2008 and Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rules 2010. As per their annual capacity it was worked out that appellant is required to pay Rs.66 Lakhs as duty per month. The packing machines were remained sealed during the period 25.07.2012 to 21.08.2012 and machine started working on 22.08.2012. As per the Rule 10 of the said rules the appellant is required to pay duty determined as per their annual capacity by 5th day of the month. The appellant did not pay the duty on 5th day of that month. As their unit was closed they paid the duty for the period 22.08.2012 to 31.08.2012 on 24.08.2012 proportionately i.e. Rs.20,32,258/-. Later on duty was demanded for the balance amount of Rs.63 lakhs less Rs.20,32,258/- as appellant has not paid duty for whole of the month on 5th day of the said month. Against the said order the appellant made a representation before the Ld. Commissioner on 12.03.2013 and on 14.03.2014, the representation made by the appellant was considered and it was directed by the Ld. Commissioner to pay duty as per ACDO. Aggrieved from the said order appellant is before me.

2. Ld. AR took the preliminary objection that against this order appeal is not maintainable before this Tribunal as it is not an appealable order. She drew my attention to the various provisions of the Central Excise Act and submits that appeal is lying before this Tribunal against an order passed by the Adjudicating Authority and in this case Adjudicating Authority is Deputy Commissioner who has passed the order for demanding duty and against the said order appeal lies with Commissioner (A) not before this Tribunal. Therefore, this appeal be dismissed as non maintainable. She further submits on merits as per rule 10 of the said rules, the appellant is required to pay duty for whole of the month by 5th day of the said month and if at all their claim of abatement that has to be considered by the Adjudicating Authority, if they are entitled, they will get refund of the same.

3. On the other hand Ld. Counsel for the appellant submits that as in this order the Ld. Commissioner has considered merits of the case and there after has directed to pay duty, therefore, the said order is appealable in the light of the decision of the Honble High Court of Delhi in the case of Candex Chemical Fibres Co. (P) Ltd. Vs. C.C. reported in 2014 (310) E.L.T. 500 (Del). He further submits that on merits their case is squarely governed by the decision of this Tribunal in the case of Shree Flavours Pvt Ltd Vs. C.C.E. Delhi vide order no. A/50958/14-EX(DB) dated 07.03.2014.

4. Heard the parties. Considered the submission.

5. First I have to decide the issue whether the appeal is maintainable before this Tribunal or not. Although in this case appellant made the representation before the Ld. Commissioner Central Excise, Jaipur. The Ld. Commissioner has considered the issue on merits as under:

6. Thereafter, the Ld. Commissioner (A) directed the appellant to pay the duty as demanded by the ACDO. As the order has been passed by the Ld. Commissioner for demanding duty. Therefore, in the light of the decision of the Candex Chemical Fibres Co. (P) Ltd. (supra), I hold that appeal against this order is maintainable before this Tribunal.

7. Now I consider the issue on merits. Similar issue came up before this Tribunal in the case of Shree Flavours Pvt Ltd. (Supra) wherein this Tribual has observed in para 6 of this order as under:

 The deposit of the dues are required to be done by a manufacturer by the 5th of a particular month. It is in this scenario that the Rules required a manufacturing unit to deposit the entire duty for that particular month by 5th day of that particular month. If subsequently the unit is closed, they are given liberty to file abatement and seek refund of duty. However, in a scenario where a manufacturing unit is aware of the closure of its unit, before the duty is deposited by him for the entire month, he may seek abatement at that particular point of time, make deposit of duty for working days only. The non following of the said procedure, may result in confirmation of interest against the assessee, but will not result in denial of the substantive benefit available to him in terms of the rules, in question. As the appellant have already deposited the interest amount and is not contesting the same, we find no justification for confirmation of demand against him for the period of admitted closure of the factory. As such, we set aside the impugned order and allow the appeal itself, with consequential relief to the appellant. 

8. In this case also the factory of the appellant was closed for the period 25.07.2012 to 21.08.2012 and duty was not paid by the appellant on 05.08.2012 as their factory was not functioning but when the factory started functioning on 22.08.2012 they have paid the duty on 24.08.2012. If at all the appellant are liable to pay, they are liable to pay interest for the period of 05.08.2012 to 24.08.2012 which appellant has already paid. Therefore, following the decision of this Tribunal in the case of Shree Flavours Pvt Ltd. (Supra) I hold that appellant is not required to pay duty.

9. Accordingly impugned order is set aside and appeal is allowed with consequential relief if any.

(Dictated and pronounced in the open court)

(Ashok Jindal) Member (Judicial)

Bhanu

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E/58284/2013-EX(SM)