2019 (2) TMI 1095 – CESTAT HYDERABAD – TMI – Clearance of Cement to dealers/retail agencies – N/N. 04/2006-CE dated 01.03.2006 as amended from time to time – benefit denied on the ground that the clearances made directly to various industries like contractors/ builders/ construction companies are not eligible for assessment under Sl.No.1C of the N/N. 04/2006-CE and therefore, proposed to demand duty under Sl.No.1A of the notification.
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Whether the assessee is entitled to the benefit of N/N. 04/2006-CE (Sl.No.1C) in respect of the cement cleared by them in 50 Kg bags marked as “meant for industrial use” and “not for retail sale” and sold to institutional/ bulk buyers? – Held that:- The issue is no longer res integra and it has been settled by the Tribunal in the case of Mysore Cements Ltd [2009 (5) TMI 445 – CESTAT, BANGALORE] and affirmed by the Hon’ble High Court of Karnataka. Respectfully following the ratio, it can be held that assessee is entitled to the benefit of exemption
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otification – demand and interest, if any, on account of sales to individuals by the appellant are upheld.
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Penalties also set aside.
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The appeals are disposed of by way of remand to the original authority for the limited purpose of determining the duty, if any, payable and interest thereon. – E/25403/2013, E/26266/2013, E/23453/2014, E/21341/2015, E/31070/2016, E/30491/2017 – A/30195-30200/2019 – Dated:- 18-2-2019 – Mr. M.V. Ravindran, Member (Judicial) And Mr. P. Venkata Subba Rao, Member (Technical) Shri T. Jagapathi Rao, Advocate for the Appellant. Shri B. Guna Ranjan, Superintendent/AR for the Respondent. ORDER Per: P.V. Subba Rao. 1. All these six appeals have been filed by the appellant against Orders-in- Original and Order-in-Appeal as above. Heard both sides and perused the records. 2. Learned consultant for the appellant submits that the issue in all these cases fall in a narrow compass. The appellants manufacture cement which they clear mainly in two ways. (a) by s
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ification 04/2006-CE and therefore, proposed to demand duty under Sl.No.1A of the notification. He also proposed to impose penalty under Rule 25(1) of the Central Excise Rules read with Sec.11AC of the Central Excise Act. He submits that exemption notification exempted goods under various heads is as follows: 1. Individual buyers who buy Cement bags for construction of their own house/ building etc., 2. Contractors/ Builders who buy Cement bags for use in the construction of Buildings etc. and sell the buildings/ constructions after completion of construction. 3. Industries who buy cement bags for construction of their factory or for constructing any civil structures in their factory. 4. Industries who buy Cement bags as inputs and cleared as such. 5. Industries who buy Cement bags for use in production, manufacturing etc. 3. He submits that the dispute is whether the cement manufactured and supplied to bulk industrial consumers but sent in 50 Kg bags specifically indicating that it is
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ction (1) of section 5A of the Central Excise Act, 1944 (1 of 1944), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts excisable goods of the description specified in column (3) of the Table below read with the relevant List appended hereto, as the case may be, and falling within the Chapter, heading or sub-heading or tariff item of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) (hereinafter referred to as the Central Excise Tariff Act), as are given in the corresponding entry in column (2) of the said Table, from so much of the duty of excise specified thereon under the First Schedule to the Central Excise Tariff Act, as is in excess of the amount calculated at the rate specified in the corresponding entry in column (4) of the said Table and subject to the relevant conditions specified in the Annexure to this notification, and the Condition number of which is referred to in the corresponding entry in
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not manufactured in a mini cement plant, not covered in S.No.1B, other than those cleared in packaged form; Rs. per tonne 400 – Explanation:- For the purposes of S.Nos.1, 1A, 1B and 1C- 1. mini cement plant means – (i) A factory using vertical shaft kiln, with installed capacity not exceeding 300 tonnes per day or 99,000 tonnes per annum and the total clearances of cement product by the factory, in a financial year, shall not exceed 1,09,500 tonnes; or (ii) A factory using rotary kiln, with installed capacity not exceeding 900 tonnes per day or 2,97,000 tonnes per annum and the total clearances of cement produced by the factory, in a financial year, shall not exceed 3,00,000 tonnes; 2. retail sale price means the maximum price at which the excisable goods in packaged form may be and the price so printed is the sole consideration for the sale: Provided that if the goods are cleared in wholesale packages containing a number of standard packages with retail sale price declared on them, th
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aid clearances are made to institutional consumers by the appellant. The only contention that has been raised by the learned Commissioner is that under such institutional consumers, construction companies would not fall under the service industry and it is his interpretation that institutional consumers would be merely airways, railways, etc. We are not inclined to accept this proposition of the learned Commissioner. Construction activity has been considered as a service industry by the Finance Ministry itself, which is obvious as there is imposition of Service Tax on the commercial or industrial construction services and also on construction complex . It is an admitted position that the Foreign Trade Policy of Government of India in the list of services as enumerated in Appendix-10 clearly indicated the following services as service industry. 3. Construction and related Engineering services A. General Construction work for building B. General Construction work for Civil Engineering C.
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ed by the Central Board of Excise and Customs under Circular No.625/16/2002 dated 28-2-2002 wherein it was clarified that goods sold in bulk at contracted price are to be assessed under Section 4. During the hearing of the case, learned counsel for the appellants has also relied on several decisions of the Tribunal – Bharti Systel Ltd v. CCE [2002 (145) ELT 626 (T)=2002 (51) RLT 649]. CCE v. Trishul Research Lab Pvt Ltd [2002 (144) ELT J204], Goa Bottling Co. Ltd v. CCE [2001 (128) ELT 81 (LB)] and H & R Johnson (India) Ltd v. CBEC [2002 (144) ELT 506 (Kar.)]. 4. We have perused the records and considered the submissions made by both sides. We find merit in the submissions made on behalf of the appellant. Marking on the goods prominently stated that the goods were specially packed for builders . Thus, the goods were intended for a particular industry and thus, remained excluded under Rule 34 of the Packaged Commodities Rules. The Commissioner (Appeals) has rejected this claim of th
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refore, the issue has reached finality. In view of the above, the impugned orders may be set aside with consequential relief. 5. Learned departmental representative agrees that the issue is covered by the order of the Tribunal in the case of Mysore Cements Ltd (supra) as confirmed by the Hon ble High Court of Karnataka insofar as the institutional buyers are concerned. He further draws the attention of the bench to Para 5 of the show cause notice in which it has been held that the appellant is supplying cement to five categories of buyers. One of these categories is individual buyers who buy cement bags for construction of their own house/ building. This fact has been brought out in Para 19.1 of the impugned OIO which reads as follows: 19.1 From the materials on record it is undisputed that assessees have sold the cement in 50 kgs bags without mentioning any RSP to the following customers. 1. Individual buyers who buy Cement bags for construction of their own house/ building etc., 2. C
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sumption. He further asserts that the appellants sell cement to industrial consumers and to dealers only and not to individuals for personal consumption. 8. We have considered the arguments on both sides and perused the records. The issue which falls for consideration is whether the assessee is entitled to the benefit of notification 04/2006-CE (Sl.No.1C) in respect of the cement cleared by them in 50 Kg bags marked as meant for industrial use and not for retail sale and sold to institutional/ bulk buyers. A related issue is whether the same exemption notification is also available to sales, if any, are made to individual consumers by the assessee. In so far as the first question is concerned, we find that the issue is no longer res integra and it has been settled by the Tribunal in the case of Mysore Cements Ltd (supra) and affirmed by the Hon ble High Court of Karnataka. Respectfully following the ratio, we hold that assessee is entitled to the benefit of exemption notification for t
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