No Merchant over time charges Leviable for Services provided by Central Excise Officer during office hours: Gujarat HC [Read order]
The bench observed that the respondent's demand for MOT charges is not supported by any statutory provision or administrative instruction
Central Excise Officer – Gujarat HC – Gujarat highcourt – Central Excise – Services – Office Hours – MOT – Merchant Overtime – regular office hours – taxscan
Central Excise Officer – Gujarat HC – Gujarat highcourt – Central Excise – Services – Office Hours – MOT – Merchant Overtime – regular office hours – taxscan
The Gujarat High Court has ruled that MOT (Merchant Overtime) charges are not applicable for services provided by Central Excise Officers during regular office hours.
The court observed that such charges could only be levied for services performed outside of normal working hours, providing relief to the export-oriented unit, which was being asked to pay these charges for services conducted during regular hours.
In this case, M/S Naval Overseas Pvt. Ltd, the assessee has contested the demand for MOT charges, arguing that the services provided by the officers were during their official working hours and hence should not incur additional fees. The company maintained that such charges were only justified for overtime services rendered outside of regular office hours.
The appellant, represented by Paritosh Gupta, contended that the services rendered by the Central Excise Officers during normal office hours do not fall within the scope of MOT charges.
It was further argued that the demand for MOT charges for services during office hours is contrary to the Central Excise Manual and Circulars issued by the Central Board of Excise and Customs (CBEC).
The High Court observed that "as per the Central Excise Manual, MOT charges are to be levied only for services rendered beyond the normal working hours and on holidays. The insistence on payment of MOT charges for services during regular office hours amounts to a misinterpretation of the relevant provisions."
The bench of Justices Bhargav. D. Karia and Niral. R. Mehta noted that Circular No. 52/96-CX dated 23.07.1996 issued by the CBEC specifically clarifies that MOT charges are not leviable for services provided during normal working hours.
Accordingly, the appeal was allowed, stating the appellant would not be liable to pay Merchant Overtime Charges for examining and supervising export goods loading at the manufacturer's factory during working hours, contrary to the instructions of the Central Board of Excise and Customs.
To Read the full text of the Order CLICK HERE
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