The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) set aside an excise duty demand of ₹13.63 lakh after holding that the Commissioner (Appeals) wrongly dismissed the company’s appeal on the ground of an eight-day delay.
The bench of Justice R. Muralidhar (Judicial Member) and K. Anpazhakan (Technical Member) has observed that the dispute on the merits had already been settled in Tata Motors’ favour in earlier proceedings, making the demand unsustainable.
The dispute centered on the denial of the benefit of Notification No. 67/95-CE, which grants exemption to specified goods manufactured and captively consumed within a factory. The department alleged that Tata Motors had manufactured and used items such as trolleys, lifting tackles, trailers, cabinet work benches, racks, and tables without paying excise duty, contending that these goods were not entitled to the exemption.
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Before the Tribunal, Tata Motors argued that the Commissioner (Appeals) had dismissed its appeal solely because it was filed with a delay of eight days beyond the prescribed period. The company contended that such a delay was well within the statutory condonable period and ought to have been excused. It also submitted that the substantive issue had already been decided in its favour by the Tribunal in an earlier case involving identical goods and the same exemption notification.
The Tribunal agreed with Tata Motors on the issue of limitation, observing that the delay before the Commissioner (Appeals) was only eight days, which clearly fell within the authority’s power to condone.
It held that the Commissioner (Appeals) ought to have exercised the discretion available under the law instead of dismissing the appeal outright. Accordingly, the Tribunal condoned the delay and proceeded to decide the dispute on merits instead of remanding the matter.
On the substantive dispute, the Bench noted that the controversy was no longer res integra. It referred to its earlier judgment in Commissioner of Central Excise, Jamshedpur v. Tata Motors Ltd. [2010 (251) ELT 411 (Tri.-Kol.)], where identical products had been held to qualify as shop floor equipment used in the manufacturing process and therefore eligible for exemption under Notification No. 67/95-CE.
The Tribunal also observed that another batch of periodical demands involving the very same goods had subsequently been decided in Tata Motors’ favour by the Commissioner (Appeals) through Order-in-Appeal No. 586/JSR/2018. That order accepted that the goods were shop floor equipment used within the factory and extended the benefit of the exemption. Importantly, the Revenue had not challenged that order, allowing it to attain finality.
The Bench emphasized that once the issue had already been conclusively determined in earlier proceedings involving identical facts, judicial discipline required consistent application of the same view in subsequent periodical demands.
Since the present proceedings involved the same category of goods and the same exemption notification, there was no justification for sustaining the excise demand. The Tribunal held that the earlier decisions squarely governed the present appeal.
Allowing Tata Motors’ appeal, the CESTAT set aside the impugned order confirming the duty demand and granted the company consequential relief in accordance with law.
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