Commissioner of GST & Central Excise Tirunelveli Versus M/s. Unimech Industries
Central Excise
2019 (1) TMI 1096 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 16-1-2019
Appeal No. E/524/2012 – Final Order No. 40100/2019
Central Excise
Ms. Sulekha Beevi C.S., Member (Judicial) And Shri Madhu Mohan Damodhar, Member (Technical)
Shri S. Govindarajan, AC (AR) for the Appellant
Shri M.N. Bharathi, Advocate for the Respondent
ORDER
Per Bench
The above appeal is filed by the department against the order passed by Commissioner who set aside Rs. 34,94,737/- raised in the show cause notice and confirmed the demand of only Rs. 23,14,649/- along with interest and imposed equal penalty.
2. On behalf of the appellant, ld. AR Shri S. Govindarajan supported the grounds of appeal. He submitted that the show cause notice was issued after noting discrepancies in the figures shown in the Profit & Loss account and ERI returns. The respondent was engaged in trading of good
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was found that the sales invoices in some cases showed higher amount whereas in some cases it did not show any difference to as the value of the goods when purchased from outside. The ld. AR argued that when the respondents have sold the goods at a higher price after purchase, they had modified the goods so as to suit the requirement of their client namely Thermal Power Plants. This activity of value addition amounts to manufacture. The Commissioner has wrongly dropped the demand raised on such enhanced value shown in sales invoices holding that it cannot be presumed that the activity amounts to manufacture. When there is increase in the value, it is strong indication that the respondents have undertaken process of manufacture on the goods purchased. Thus, the demand of duty on the amount corresponding to the enhanced value shown in the sales invoice as raised in the show cause notice ought to have been confirmed.
3. The ld. counsel Shri M.N. Bharathi submitted that the grounds of ap
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ith the predeposit.
4. Heard both sides.
5. The department is aggrieved by the order passed by the Commissioner who dropped part of the demand of Rs. 34,94,737/-. Though the ld. AR has put forward the argument that the dropping of said demand is not correct when the activity of doing modifications on the products purchased having been admitted by the respondent, there is actually no such ground raised in the appeal filed before this Tribunal. The ground raised in the appeal memorandum is that the Commissioner has not given any finding with regard to limitation or with regard to confirmation of interest and demand.
6. In the impugned order, in paragraphs 13 to 16, the Commissioner has discussed the issue of the difference in the figures reflected in the returns filed by the respondent and the financial statement. The demand in respect of Rs. 34,94,737/- is made only in respect of such amount reflected in the sales invoices wherein the goods have been sold at a higher price by the res
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