CX - Manufacture - there is no evidence to show that applicants undertook any activity which amounts to manufacture after clearance from Customs - Stay on demand of CE duty of Rs 58 Cr - Revenue seeks modification - since retail price affixed before clearance from Customs and appropriate CVD paid, no ground to modify Stay order: CESTAT
By TIOL News Service
MUMBAI, JAN 08, 2013: THE applicants imported cosmetic products.
It is the case of the Revenue that applicants are affixing retail sale price on the imported cosmetic products and this activity amounts to manufacture in terms of section 2(f)(iii) of the CEA, 1944 w.e.f 01.03.2003 and, therefore, the applicants are liable to pay Central Excise duty.
The CCE, Thane-I did not bat an eyelid while confirming the duty demand of Rs.58.34 Crores on the applicant and imposed an equal penalty and also interest.
In appeal, the CESTAT while granting Stay held (See 2012-TIOL-1117-CESTAT-MUM) -
"7. We find that there is no evidence on record to show that applicants undertaking any activity which amounts to manufacture as applicants were not labelling or relabeling of packages nor affixing any retails sale price after the clearance from the customs. The retails sale price is affixed before the clearance of the goods from the customs area as per the requirement by the Notification no. 44(RE-2000)/1997-2002 dt. 24.11.2000 and paid the CVD duty as per the retails price fixed on the goods. In view of this, we find that the applicants had made out a strong case in their favour. The pre-deposit of dues are waived and recovery of the same is stayed during the pendency of the appeal."
Now, the CCE, Thane-I is before the CESTAT with an application for Modification of the Stay order (!) and parrots the same submissions made at the time of hearing of the Stay application viz. that the importer-appellant affixed the sale price on the goods imported and affixing of retail sale price amounts to manufacture as per Chapter Note 33 of the Central Excise Tariff.
The Bench observed -
“2. We find that the retail sale price was affixed before the clearance of the goods from the Customs and appropriate CVD duty has been paid. In these circumstances, we find no ground to modify the stay order dated 14.06.2012. Further, we find that the revenue involved in this case is more than Rs.58 crores, therefore, the Registry is directed to list this appeal for regular hearing on 7.2.2013.”
In passing: Seeking Review in the guise of modification…what an Idea Sirji!
(See 2013-TIOL-49-CESTAT-MUM)