Heard Mr.T.Ramesh, learned counsel for the petitioner, Mr.T.V.Krishnamachari, learned Central Government Standing Counsel for the first respondent and Mr.A.P.Srinivas, senior panel counsel for the second respondent.
2. The petitioner is aggrieved by an order passed by the first respondent, the Revisional Authority, who interfered with the order passed by the second respondent, namely the Commissioner of Central Excise (Appeals) in Appeal No.80/2003 dated 06.08.2003. The matter concerns as to what will be the quantum of loss which would occur while handling and storing lubricating oil and grease. The Commissioner of Central Excise (Appeals) took into consideration the earlier orders, wherein the petitioner themselves have been permitted to adopt a figure of 0.21% as loss which has occurred due to spillage or in the process of repacking.
3. The first respondent set aside the order and remanded the matter to the Commissioner with a direction to follow a circular issued by the CBEC dated 04.10.1976. Admittedly, the most important factor which has to be considered while assessing the spillage loss or loss which may occur during the course of packing is, the manner in which the repacking or packing is done at the factory of the concerned assessee. Obviously, in the year 1976, there was no much automation in various factories except in auto mobile industries. The percentage of loss which was adopted at 0.21% was for the period 1997-98. Subsequently, the loss in case of other assessees has been fixed between 0.4% to 0.5%. Therefore, it will be inequitable for the second respondent to adopt a percentage of loss which was fixed in the 1976 regardless of the facilities available in the assessee's factory. Therefore, to that extent, the order of remand passed by the first respondent is incorrect.
Accordingly, this writ petition is allowed and the impugned order dated 30.04.2004 is set aside. The matter is remanded back to the first respondent to apply a percentage for spillage and loss during repacking by calculating an average, which was adopted in the case of the petitioner for the earlier three assessment years. Such exercise shall be done within a period of four weeks from the date of receipt of a copy of this order and a speaking order be passed to the said effect. No costs.
02.08.2017 Index: yes/no gpa To
1. The Joint Secretary to the Govt. of India Ministry of Finance Dept. of Revenue 4th Floor, Jeevandeep Buildings Sansad Marg, New Delhi- 110 001
2.The Commissioner of Central Excise Chennai I Commissionerate No.121, Mahathma Gandhi Road Chennai 600 034 T.S.SIVAGNANAM, J., gpa W.P.No.18278 of 2004 02.08.2017