Commissioner of Central Excise Vs. Dhanlaxmi Paper Mills

Commissioner of Central Excise vs Dhanlaxmi Paper Mills

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Mumbai Decided Oct 24, 2003

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Citation: sooperkanoon.com/32790
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Mumbai
Judge: S T S.S.
Decided On: Oct 24, 2003
Subject: Service Tax

Case Summary

AI-generated summary - not the official court judgment text.

Service Tax

Key legal issue: Service Tax

Parties & Advocates

Appellant / Petitioner

Commissioner of Central Excise

Respondent

Dhanlaxmi Paper Mills

Legal References

Reported In: (2004)(91)ECC271

Excerpt

.....explanation (iii) to rule 57a would exclude the packing material from eligibility as inputs since duties are not paid on assessable value as per section. a) tariff value under section 3(2) as held by the supreme court in the case of century manufacturing co. ltd. {1992 (60) elt 3 sc} are to be fixed by the central government after taking into account all relevant factors. there is no material on record produced by revenue to conclude that the cast of the impugned inputs have not been reckoned while fixing the tariff values. since revenue wants to deny the credit on that basis the onus is on them. the bland allegations made in the appeal will not suffice. ii) packaging material in respect of which any exemption to the extent of duty of excise payable on the value of the packaging material is being availed of for packaging any final product; iii) packaging material, the cost of which is not included or had not been included during the preceding financial year in the assessable value of the final product under section 4 of the act; revenue not challenging exclusion under inclusive clause (b) would imply that there is no doubt even in revenue's mind regarding the exemption from duty to the extent of value of the packing material being availed in this case. as regards clause (iii) of the exclusion there is no material, which the revenue has to produce to conclude that cost of the packaging is not being included in the current year's clearances or that in the preceding financial year any such cost was claimed and/or allowed as deductions or not included. the ground taken is therefore not substantiated. the clause (iii) is not applicable on facts and is to be rejected. c) once the commissioner of central excise (appeals) has found the impugned goods to be used in relation to manufacture 'and the paper tube to be nothing but packing material' the inputs stand to be eligible for credit b the concept of input under rule 57a and the inclusion clause of the explanation.....

Full Judgment

1. Revenue is aggrieved on grant of credit on paper tube used by a texturiser, to wind the yarn when duty on yarn is paid on tariff value fixed under Section 3(2) of the Central Excise Act, 1944 on the grounds - (i) Cost of paper tubes not included in the value of final product.

Tariff value does not include the value of inputs. Therefore, credit on 'Antistatic Oil' and 'Paper Tube' is not eligible.

(ii) Explanation (iii) to Rule 57A would exclude the packing material from eligibility as inputs since duties are not paid on assessable value as per Section.

a) Tariff value under Section 3(2) as held by the Supreme Court in the case of Century Manufacturing Co. Ltd. {1992 (60) ELT 3 SC} are to be fixed by the Central Government after taking into account all relevant factors. There is no material on record produced by Revenue to conclude that the cast of the impugned inputs have not been reckoned while fixing the tariff values. Since Revenue wants to deny the credit on that basis the onus is on them. The bland allegations made in the appeal will not suffice.

ii) packaging material in respect of which any exemption to the extent of duty of excise payable on the value of the packaging material is being availed of for packaging any final product; iii) packaging material, the cost of which is not included or had not been included during the preceding financial year in the assessable value of the final product under Section 4 of the Act; Revenue not challenging exclusion under inclusive Clause (b) would imply that there is no doubt even in Revenue's mind regarding the exemption from duty to the extent of value of the packing material being availed in this case. As regards Clause (iii) of the exclusion there is no material, which the Revenue has to produce to conclude that cost of the packaging is not being included in the current year's clearances or that in the preceding financial year any such cost was claimed and/or allowed as deductions or not included. The ground taken is therefore not substantiated. The Clause (iii) is not applicable on facts and is to be rejected.

c) Once the Commissioner of Central Excise (Appeals) has found the impugned goods to be used in relation to manufacture 'and the paper tube to be nothing but packing material' the inputs stand to be eligible for credit b the concept of input under Rule 57A and the inclusion clause of the Explanation (b) to Rule 57A. Any exclusion by reading of exclusion Clause (ii) and/or (iii) will require evidence of substantial nature and not presumptions and assumptions.

No grounds are therefore found to be valid to entertain Revenue appeal."

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Mumb... Same Parties Commissioner of Central Excise vs Dhanlaxmi Paper Mills Same Subject Service Tax Same Judge S T S.S.