The extended period of limitation is not invokable when there are divergent views on the issue.

PJ/Case Laws/2012-13/1390

Case:- M/S DURALL SYSTEMS INDIA PVT LTD, SMT SENHA MANOJ SAKHARKAR, SHRI ANIL ANANT SAKHARKAR, SHRI MANOJ ANANT SAKHARKAR V/S COMMISSIONER OF CENTRAL EXCISE, MUMBAI-II

Citation: 2013-TIOL-62-CESTAT-MUM

Brief Facts: - The present applications has been filed by the applicant for waiver of pre-deposit of duty of Rs.44854486/-, interest and penalties. The demand is confirmed in respect of the Aluminum Sliding Windows, Aluminum Doors & Glazing Systems classifiable under Chapter 76 of the Central Excise Tariff Act, 1985.

Appellant’s Contention: - The appellant contended that they are manufacturing and clearing Aluminum Sliding Windows, Aluminum Doors from the factory and the clearance of these items is within the limit prescribed under the small scale exemption notification. In respect of the Aluminum Assembly of Glazing Systems, their contention is that, the glazing is of glass which comes into existence at site and it is immovable property. Therefore, the glazing cannot be treated as goods liable to duty. They also submitted that all the items directly come to the site where the structure was erected and glass was fixed therein. Further it was contented that nothing has been done in the factory in respect of glazing therefore the demand on the entire glass glazing is not sustainable. They have already paid the service tax in respect of the activity undertaken in respect of glass glazing and they has not availed any credit in respect of the duty paid on inputs used in the glass glazing. If the credit on inputs is taken into consideration they had already paid more than 50% of the demand.
Further they submitted that major portion of the demand is time barred as the demand is made in view of the Larger Bench decision of the Tribunal in the case of Mahindra & Mahindra Ltd. Vs. C.C.E., Aurangabad, Chandigarh reported 2005 (190) E.L.T. 30 (Tri.–LB) = (2005-TIOL-1215-CESTAT-DEL-LB) prior to this decision there were divergent views on the issue hence it cannot be said that they suppressed the facts with intent to evade payment of duty.

Respondent’s Contention: - The respondent-revenue on the other hand relied upon the decision of the Tribunal in the case of Alumayer India Pvt. Ltd. vs. Commr. of Cus. & C. Ex., Hyderabad reported in 2012 (278) E.L.T. 123 (Tri.-Bang.) and submit that in a similar situation the Tribunal confirmed the demand after taking into consideration the fact that the aluminum sections were taken to the site of customers directly without bringing to the premises of the assessee. The Tribunal relying upon the decision of the Tribunal in the case of Mahindra & Mahindra Ltd. (supra) confirmed the demand in respect of aluminum structure classifying the same under Chapter 76 of the Tariff. Thus, the ratio of the above decision is fully applicable to the facts of the present case.

Reasoning of Judgment: - The Hon’ble Tribunal held that the issue regarding excisability of structures came before the Tribunal in the case of Mahindra & Mahindra Ltd. (supra). Prior to this decision there are divergent views on the issue. Therefore prima facie they find merit in the contention of the applicant that extended period of limitation is not available to the Revenue. Then taking into consideration the demand within the normal period of limitation which comes to Rs.12304978/-, as evident in the adjudication order. In view of the decision of the Tribunal in the case of Alumayer India Pvt. Ltd. (supra) applicant failed to make out a case of total waiver of duty. During the arguments the applicant submitted that applicant had already paid an amount of Rs.2843836/- had been appropriated in the impugned order. Taking into facts and circumstances of the case, the demand for the normal period and the availability of credit on the inputs, the applicants are directed to further deposit an amount of Rs.50,00,000/- within eight weeks. On deposit of the above mentioned amount, the pre-deposit of the remaining amount of duty, interest and penalty is waived and recovery of the same is stayed during the pendency of the appeal.

Decision: - Pre-deposit of duty ordered.

Comment:-The analogy drawn from this case is that the larger period of limitation cannot be invoked wherein the issue under consideration is covered by divergent views by the Tribunals.

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PJ/Case Laws/2012-13/1390

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