CONCEPT PHARMACEUTICALS LTD. Vs. COMMR. OF C. EX.

JUDGEMENT

(1.) THIS is an appeal filed by M/s. Concept Pharmaceuticals Ltd. (hereinafter referred to as 'the appellants') against the impugned order passed by the Commissioner of Central Excise, Aurangabad. The brief facts of the case are that the appellants are the manufacturers of P & P Medicines and under the provisions of Notification No. , dated 7 -1 -2005 and Notification No. , dated 23 -2 -2005, the medicaments are assessed under the provisions of Section 4A of the Central Excise Act 1944 based on maximum retail price less abatement of 35%/40%. It was noticed that the appellants are not discharging the duty liability correctly under Sec. 4A of the Central Excise Act and on verification of the documents it was seen that the appellants had paid duty on the basis of lower value arrived at under Sec. 4A of the Central Excise Act. For the purpose of central excise duty, they had calculated the assessable value after deducting central excise duty element from maximum retail price and thereafter claimed the deduction under Notification 2/2005 -C.E. (N.T.) and they had not paid the duty on the value arrived at by deducting abatement from maximum retail price. Accordingly show -cause notice dated 31 -3 -08 was issued to the appellants demanding duty with interest and also proposing imposition of penalty. Show cause notice was adjudicated by the impugned order under which the Commissioner has confirmed the duty of Rs. 62,40,570/ - and also ordered recovery of interest under Section 11AB of the Central Excise Act and also imposed penalty equivalent to the duty as confirmed by the Commissioner. The appellants are in appeal before the Tribunal against the impugned order.

(2.) THE Ld. Advocate appearing for the appellants submitted that the appellants are not challenging the order on merit but are challenging the order only on the ground of time limitation. He submitted that the relevant fact for the purpose of demanding differential duty is calculation of assessable value after deduction of excise duty from the MRP and thereafter abatement claimed in terms of Notification under Sec. 4A of the Central Excise Act. He submitted that the appellants have not misstated or suppressed any fact about the manner of determination of assessable value since they have sent a letter dated 10 -1 -2005 addressed to the Asstt. Commissioner of Central Excise in which they have specifically mentioned that the manner of determination of assessable value of various products manufactured by them was indicated in the Annexure to the said letter. He further contended that in the Annexure to the aforesaid letter dated 10 -1 -2005, the appellants have indicated for each and every product manufactured by them, MRP declared on the package and deducted the excise duty from such MRP and shown the amount equal to MRP less excise duty as "MRP under DPCO" and thereafter the amount equal to 65% of such MRP under DPCO arrived at the aforesaid manner was shown as the assessable value for payment of duty. He submitted that the show -cause notice in this case was issued on 31 -3 -08 and since they had declared all the calculations in the Enclosures attached to the letter dated 10 -1 -2005, there is no misstatement or suppression of fact invoking the extended provisions of Sec. 11A of the Act. Hence show -cause notice is clearly hit by the time limitation and the Order -in -Original needs to be set aside on the ground of time bar.

(3.) AFTER hearing both sides, we find that, the issue involved in the appeal is regarding valuation of the goods under Sec. 4A of the Central Excise Act, 1944. The appellants are not contesting the demand on merit. They are contesting the order on the ground of time limitation. The appellants are relying on the letter dated 10 -1 -2005 addressed to the Asstt. Commissioner of Central Excise, Aurangabad.