SHREE FLAVOURS LLP Vs. GOVERNMENT OF INDIA

JUDGEMENT

(1.) The powers of the Customs and Central Excise Settlement Commission (hereafter referred to as 'Settlement Commission') constituted under section 32 of the Central Excise Act, 1944 (hereinafter referred to as 'the CEA'), to send the matter to the adjudicating authority by rejecting the application for settlement filed by the Petitioner, are in question in the present case.

(2.) The Petitioner No.1 ('the Petitioner'), Shree Flavours LLP, is a Limited Liability Partnership firm of which the remaining Petitioners Nos. 2 to 8 are the partners. It is engaged in the business of manufacturing Flavoured Chewing Tobacco ('FCT') at its factory at 11/7, Mathura Road, Faridabad, Haryana. The FCT manufactured by the Petitioner is packed in various types of packing i.e. Pouches, P.P. Jars and Tins. Each of these packing's is in various pack sizes. As per the Petitioner, the packing of FCT products was undertaken by it either manually or with the help of manually operated machines. FCT being excisable, the Petitioner avers that it was paying excise duty on the products of its manufacture.

(3.) There are three types of assessments under the provisions of the CEA. First, under Section 4 of the CEA, goods are assessed as per the transaction value i.e. the consideration received from the purchaser. The second method is under Section 4A of the CEA, which is based on the MRP of the products, provided the goods are excisable and there is a requirement of declaring their MRP under provisions of applicable laws. The third method is the method of deemed assessment, under Section 3A, which is based upon the 'capacity of production'. Under this method, the Excise Authorities do not go into the details of the actual production but the assessment is done on the basis of 'presumed production'.