TENNCO EXHAUST INDIA PVT LTD VERSUS C.C.E. & S.T.-Vadodara-II

Excise Appeal No. 374 of 2012

(Arising out of OIA-COMMR-A-92-VDR-II-2012dated 16.02.2012passed by

Commissioner of Central Excise, CUSTOMS (Adjudication)-VADODARA-II)

 

TENNCO EXHAUST INDIA PVT LTD

VERSUS

C.C.E. & S.T.-Vadodara-II

 

APPEARANCE:

None appeared for the Appellant

Shri. Dinesh Prithiani, Assistant Commissioner (AR) for the Respondent

CORAM: HON’BLE MEMBER (JUDICIAL), MR. RAMESH NAIR

HON’BLE MEMBER (TECHNICAL), MR. RAJU

Final Order No. A/ 10034 /2023

DATE OF HEARING: 29.11.2022

DATE OF DECISION: 10.01.2022

RAJU

The appeal has been filed by Tennco Exhaust India Private

Limited against demand of Central Excise duty, interest and

imposition of penalty.

None appeared for the appellant although numerous hearings

have been given on 29.08.2022, 28.09.2022, and 01.11.2022 dates

and there was no adjournment request. Consequently, since the

matter is old, it is being taken up for decision Ex-party.

Learned Authorized Representative for the Revenue pointed

out that the appellants are making certain products for M/s General

Motors (India) Private Limited. For manufacture of those products,

they require tools and moulds. The appellants have issued 5

invoices to General Motor (India) Private Limited and paid VAT on

the same. The appellants have claimed exemption under

Notification 67/95-CE in respect of 3 of these invoices as the said

moulds and tools were used within the factory by the appellant for

manufacture of excisable goods for General Motors (India) Private

Limited.

Learned Authorized Representative relied on the decision of Tribunal

in the case of Steel Authority of India Limited 2016 (334) ELT 661

and JBM Auto 2017 (351) ELT 1107 to assert that the appellants

were required to pay duty on these deemed clearances of goods

within the factory of manufacture.

Learned Authorized Representative further pointed out that

two of these invoices were in respect of goods, namely, Tools and

Moulds cleared by the appellant to their factory located in Pune.

Learned Authorized Representative pointed out that the defence of

the appellant is solely basis on Revenue neutrality. It has been

argued by the appellants that the duty paid would have been

available as credit to them in their Pune Unit and therefore, no

demand can be confirmed against the appellant.

We have considered rival submissions. We find that

Notification 67/95-CE exempts goods including capital goods used

for manufacture of excisable food within the factory of production.

Learned Authorized Representative has relied on the decisions in the

case of Steel Authority of India Limited (supra). In the said case,

the goods, namely, Oxygen was cleared within the factory by the

appellant to FSNL which in turn was using the same for non

excisable activity. Since the same was used for non-excisable

activity, the benefit of 67/95-CE was denied. In that respect, the

decision is not applicable to the present case as in the present case

the appellants are manufacturing excisable goods within the factory

of production. As regard, the decision of Tribunal in the case of JBM

Auto Limited (supra), we find that there aredecisions to the contrary

in the case of Elcon Clipsal (India) Limited Final Order No. 394 of

2002-B dated 06.09.2002. In case and Sheet Metal. Industries vide

Final Order No. 941 of 2002 dated 14.08.2002 in appeal No.

E/438/95/MAS which has been relied upon by the appellant before

the original adjudicating authority. We find the no evidence has

been produced by Revenue to assert that the value of tools has not

been amortized in the value of final product clearance and therefore,

the decision of JBM Auto Limited is also distinguished on that count.

Plain reading of the Notification No.67/95-CE suggests that as long

as the goods are not cleared physically form the factory of

production and the same are used for manufacture of excisable

goods, the benefit of Notification cannot be denied. Thus, we hold

that so far as goods used within the factory of production for

manufacture of excisable goods are concerned, duty cannot be

demanded. The duty on these goods is set aside.

As regard, the goods cleared from the factory to the Pune Unit

of the appellant, the plea of Revenue neutrality has been raised by

the appellant in their appeal memorandum. We nowhere find any

evidence in support of the plea of Revenue neutrality. No data of

the Pune Unit has been submitted and how and in what manner the

goods have been used in Pune has not been stated. In view of that,

we do not find any merit in the defence of the appellant, in so far as

goods cleared from the factory of the appellant is concerned. The

demand in respect of these goods cleared from factory to the Pune

Unit is confirmed.

The appellants have also contended that extended period

cannot invoked in instant case.We find that law on this point is very

clear. Notification 67/95-CE is very straight forward and leave no

scope for doubt. In these circumstances, the motive of avoiding

duty cannot be denied. Thus, we hold that the extended period has

been rightly invoked in respect of the goods cleared from the factory

to the Pune Unit. The demand of duty and penalty on those goods

is upheld. Appeal is partly allowed in above terms.

(Pronounced in the open court on 10.01.2023)

(RAMESH NAIR)

MEMBER (JUDICIAL)

(RAJU)

MEMBER (TECHNICAL)