Supreme Court
Central Excise Exemption For Cotton Fabrics Not Available If Any Interlinked Process Uses Power : Supreme Court
The Supreme Court has held that manufacturers cannot claim central excise duty exemption for processed cotton fabrics if power is used at any stage of the manufacturing chain, even when the work is carried out through separate units. The Court restored a duty and penalty demand that had been set aside by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT).To claim excise duty exemption for 'cotton fabrics' processed without the aid of power or steam, the manufacturing stages must be...
Externally Procured Parts Supplied To Customer For Assembly, But Not Used By Manufacturer, Aren't Liable To Excise Duty : Supreme Court
The Supreme Court on Monday (November 10) dismissed the Revenue Department's excise duty demand against a company that had manufactured and erected a large boiler at a customer's site, holding that the full contract value could not be subjected to central excise duty. The Court clarified that parts bought out externally and supplied to the customer for assembly, but not actually used by the manufacturer, would not attract excise duty. “we arrive at the finding that the final product that...
Supreme Court Issues Notice On Patanjali Foods' Rs 2.97 Crore Excise Duty Refund Appeal
The Supreme Court has recently issued notice in an appeal filed by Patanjali Foods Limited (formerly Ruchi Soya Industries Ltd.) seeking a refund of Rs 2.97 crore charged by the tax department in connection with an excise duty dispute. A Division Bench of Justice Pamidighantam Sri Narasimha and Justice Atul S Chandurkar issued notice on both the main appeal and the application seeking condonation of delay. The appeal challenges the Karnataka High Court's judgment dated September 30, 2024, and...
Central Excise Tariff Act | Test Reports Justifying Reclassification Must Be Disclosed to Manufacturer : Supreme Court
The Supreme Court ruled that when a test report forms the basis for reclassification of the petrochemical products, necessitating a higher duty, than the copy of such test reports ought to be furnished to the manufacturer-taxpayer. The bench of Justices Abhay S. Oka and Ujjal Bhuyan set aside the ₹2.15 crore central excise duty demand against M/s Oswal Petrochemicals Ltd., holding that the revenue authorities had violated principles of natural justice by failing to share key evidence—such as...
Supreme Court Sets Aside Excise Duty Demand On Oil Marketing Companies For Inter-Supply Of Petroleum Products
In a significant relief for Oil Marketing Companies (OMCs), the Supreme Court ruled (Jan. 20) that prices under the MoU for inter-supply of petroleum products, designed to ensure smooth nationwide distribution, do not constitute "transaction value" and are exempt from excise duty due to their non-commercial nature. The Court emphasised that the inter-supply arrangement was not solely price-driven but aimed at facilitating seamless distribution, rendering it ineligible for excise duty.Holding so,...
Chewing Tobacco Packed In High-Density Polyethylene Bags Are 'Wholesale Package'; Cannot Be Taxed As Retail Product Under Excise Act : Supreme Court
The Supreme Court recently held that pouches of chewing tobacco packed in High-Density Polyethylene (HDPE) bags would be considered a 'wholesale package' and could not be considered for imposing excise duty as per the provisions relating to retail sale price in the Central Excise Act, 1944.The bench of Justices AS Oka and Pankaj Mithal upheld the decision of the Central Excise Appellate Tribunal which observed that chewing tobacco in HDPEs qualified as wholesale packages as they were sold only...
Labelling and Re-Labelling of Containers Qualifies as 'Manufacture' for CENVAT Credit Under Excise Act: Supreme Court
The Supreme Court has held that labelling or re-labelling of containers amounts to 'manufacture' under the Central Excise Act for availing cenvat creditThe bench of Justices A. S. Oka and Ujjal Bhuyan was pronouncing its judgment on an appeal by the revenue under Section 35L(1)(b) of the Central Excise Act, 1944 against a 2015 order passed by the CESTAT, Mumbai.By the impugned order, CESTAT has allowed the appeal filed by the respondent holding that as per Note 3 to Chapter 18 of the Central...
Supreme Court Affirms Penalty On 'Zarda' Manufacturers For Misclassifying Product As 'Chewing Tobacco' For Central Excise Duty
The Supreme Court while adjudicating a matter wherein the Assesssee deliberately misclassified the ‘Zarda’ produced by it as ‘Chewing Tobacco’ for evading payment of a high duty as applicable to ‘Zarda’, has affirmed the imposition of penalty and demand for payment of differential duty raised by the Central Excise Department from the Assessee.The Bench comprising Justice S. Ravindra Bhat and Justice Aravind Kumar, has held that, “The assessee being aware that there being no change in the nature...
Self-Assessment Of Assessee Not Rendered Malafide Merely Because It Was Based On A CETSTAT View Which Was Later Overturned : Supreme Court
The Supreme Court has upheld the decision of the Ahmedabad bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) by holding the demand for differential excise duty raised against the assessee, M/s Reliance Industries Ltd, as time barred.The court dismissed the contention that Reliance had deliberately suppressed and withheld material information and documents from the departmental officers by not filing the same and thus, the ground for invoking the extended period of...
Mere Broad-Basing Of Entries Under Central Excise Tariff Act, Cannot Justify Re-Classification, Without Change In Nature, Character Or Use Of The Product: Supreme Court
The Supreme Court has ruled that the classification of a product under the Central Excise Tariff Act, 1985, cannot be changed merely on the ground of change of tax structure or tariff entries, without showing a change in the nature and character of a product or a change in the use of the product(Commissioner of Customs, Central Excise and Service Tax, Hyderabad vs Ashwani Homeo Pharmacy).The bench of Justices Dinesh Maheshwar and Vikram Nath was dealing with an appeal against the decision of the...
Central Excise Act- No Separate Notice Necessary For Recovery Of Erroneous Refund Granted: Supreme Court
The Supreme Court has held that no separate notice under Section 11A of the Central Excise Act is necessary for the recovery of an erroneous refund granted.The division bench of Justice M. R. Shah and Justice Krishna Murari has observed that once the order originally sanctioning the refund came to be set aside, there was no question of any further notice under Section 11A of the Central Excise Act.The issue raised was whether the separate notice under Section 11A of the Central Excise Act is...