NAHAR SPG. AND WVG. MILLS LTD. Vs. CCE

JUDGEMENT

(1.) THE relevant fact of the case, in brief, are that the appellants are engaged in the manufacture of Cotton Yarn, Blended Yarn (Acrylic/Polyester) classifiable under Chapter 52 & 55 of the Schedule to the Central Excise Tariff Act, 1985. The appellants were selling their goods at factory gate and also through depot. They opted provisional assessment for payment of duty in respect of depot sales. The appellants filed refund claim consequent upon the finalization of provisional assessment. The original authority sanctioned the refund claim. The Revenue filed appeal before the Commissioner (Appeals) whereby the adjudication order was set aside and appeals of the Revenue were allowed. Hence, the appellant filed these appeals.

(2.) LEARNED Advocate on behalf of the appellants submits that the original authority sanctioned the refund claim holding that provisional assessment for the period in dispute was finalized on the basis of the price prevailing at depot on the day when the goods were cleared from the factory. He submits that in view of the amendment of Section 4 of Central Excise Act, 1944 in 1996 the depot price would be deemed to be the price for the purpose of assessment. Hence, the excess duty paid on price at the time of clearance from the factory and lower price charged on the same day at depot would be relevant to establish that incidence of duty was not passed to other person. Accordingly, the appellants are eligible for refund of excess amount of duty paid at factory gate. He relied upon the decision of the Tribunal as under:

(3.) AFTER hearing both the sides and on perusal of the records we find that there is no dispute that the appellants opted provisional assessment for selling of the goods from depot. Rule 7 of Central Excise (Valuation) Rules, 2000 provides that where the excisable goods were not sold by the assessee at the time and place of removal but were transferred to depot, from where the excisable goods to be sold after their clearance from the factory, the value shall be the normal transaction value of such goods sold from such other place at or about the same time and, where such goods are not sold at or about the same time nearest time of removal of goods under assessment. Thus, if goods are cleared from factory today to a depot, the duty would be payable on the price prevailing at the depot today. The expression "such goods" in Rule 7 is significant. For the purpose of assessment, the clearance of goods from factory to depot would deemed to be "such goods" from depot. In view of that for the purpose of unjust enrichment, price of such goods prevailing at depot to be adopted.