The Ahmedabad bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) granted relief to the Koch Chemical Technology Group by quashing the excise duty demand imposed on the extraction of petroleum fuel goods on the ground of the absence of a speaking order.
Koch Chemical Technology Group India Pvt Ltd, the appellant assessee was a private company manufacturing certain materials used in the erection of towers and for the extraction of petroleum fuels.
The assessee appealed against the order passed by the Commissioner (Appeals) against the demand of Central Excise duty.
Virendra Nayyar and Sanjay Saraswat, the counsels for the assessee contended that Rule 5 of the Central Excise (Valuation) Rules,1975 was to assert that in these circumstances, the value of freight charged separately on the invoices has to be excluded from the assessable value.
Also submitted Rule 5 of the Central Excise (Valuation) Rules was to assert that the place of removal in the instant case was the factory gate and not the premises of the buyer.
A.K. Samota, the counsel for the department relied on the decisions made by the lower authorities and contended that the demand of excise duty raised by the revenue was as per the law and liable to be sustained.
The Bench observed that the order were not supported by the exact provisions/clauses of the contracts examined and it was not understood from which clause of the contract or purchase order these conclusions had been reached and it was not a speaking order.
The two-member bench comprising Ramesh Nair (Judicial) and Raju (Technical) remanded the matter for re-adjudication after giving exact reasons along with evidence for reaching the conclusions arrived at therein and quashed the excise duty demand while allowing the appeal filed by the assessee.
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