CESTAT Quashes Excise Duty Demand on Manufacture of High Security Registration plate on ground of Limitation [Read Order]

The New Delhi bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed the excise duty demand on the manufacture of the High-Security Registration Plate (HSRP) on the grounds of limitation. 

Real Mazon India Ltd, the appellant assessee was a company engaged in the manufacture and sale of High-Security Registration Plates and windshield stickers having its manufacturing unit at Trilokpur Road, Kala Amb, District Sirmour, Himachal Pradesh and the assessee entered into agreements with State Transport Commissioners for installation of HSRP Plates and windshield stickers on the vehicles sold in their States/Union Territories. 

The assessee appealed against the order passed by the adjudicating authority for confirming the demand of Central Excise duties amounting to Rs.6,30,94,677/- on the clearances of HSRP, windshield stickers, and scrap made by the assessee along with the proportionate interest and for the imposition of penalties. 

A.K. Prasad and Surabhi Sinha, the counsels for the assessee contended that there was no intention of evasion of duty, the assessee had been paying more revenue in the form of Value Added Tax (VAT) and Service Tax, hence, the extended period should not have been invoked and the bulk of the demand was liable to be set aside being time-barred. 

Rakesh Agarwal, the counsel for the department relied on the decisions made by the lower authorities and contended that the extended period of limitation was rightly invoked and the demand raised was as per the law and liable to be sustained. 

The Bench observed that in the state of Rajasthan the assessee was discharging the service tax liability qua his activity of embossing registration on the HSRP manufactured in Himachal Pradesh and the VAT liability was also being discharged by the assessee. Thus the Department had wrongly invoked the extended period. 

The two-member bench comprising Rachna Gupta (Judicial) and Subba Rao (Technical) quashed the excise duty demand against the assessee on grounds of limitation. 

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