Delhi High Court
Commissioner Of Central Excise vs M/S Sigma Corporation India Pvt ... on 22 April, 2013
Author: Veena Birbal
THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment delivered on: April 22, 2013
+ CEAC 11/2004
COMMISSIONER OF CENTRAL EXCISE ..... Appellant
- versus -
M/S SIGMA CORPORATION INDIA PVT LTD .... Respondent
Advocates who appeared in this case:-
For the Appellant : Mr Satish Kumar, Sr. Standing Counsel
For the Respondent : Ms.Amita Gupta, Advocate
CORAM:-
HON'BLE MR JUSTICE BADAR DURREZ AHMED
HON'BLE MS JUSTICE VEENA BIRBAL
VEENA BIRBAL, J
1. This is an appeal under Section 35 G(2) of the Central Excise Act,
1944 (hereinafter referred to as „the Act‟) against the final order dated
16th January, 2004 passed by the Customs, Excise & Service Tax
Appellate Tribunal, New Delhi (hereinafter referred to as „the Tribunal‟)
whereby the appeal of the respondent against the order dated 8 th May,
2003 passed by the Commissioner (Appeals) directing the respondent to
pay Merchant Overtime Tax Charges (in short referred to as „MOT
charges‟) of ` 3,37,900/- has been allowed and the demand raised has
been set aside.
2. Briefly the facts relevant for the disposal of the present appeal are
as under:-
Respondent is manufacturer and exporter of auto parts under DEPB
Scheme. The respondent had exported certain consignments of auto parts
during September, 1997 to September, 2002. It is admitted that stuffing
of goods in containers for the export was done in the factory of
respondent under the supervision of Central Excise Officer having
jurisdiction over the factory under section 36 of the Customs Act read
with Customs (Fees for Rendering Services by Customs Officers)
Regulations, 1998. Regarding the stuffing work done by the Customs
Officer in the factory of respondent under the supervision of the
jurisdictional Central Excise Range Officer, the Deputy Commissioner of
Central Excise issued a letter directing the respondent to pay MOT
charges of over ` 7 lakhs covering the aforesaid period. The said demand
was challenged by the respondent before the Commissioner (Appeals) by
contending that for services rendered by Customs Officer, no MOT
charges were payable. It was contended that under section 36 of the
Customs Act, fee, if any, is payable only when the services for
supervision are availed after working hours. It was contended that same
was not the position in the present case, as such, no fee in the present case
was payable. However, the Commissioner (Appeal) reduced the charges
to ` 3,37,900/- by observing that calculation of the MOT fee had been
made on the basis of AR4/ARE1 register maintained in the Range Office
which was irregular and same had to be worked out on the basis of visits
and number of hours of services rendered by the Central Excise Officers
in terms of relevant regulations. The said order was challenged by the
respondent by filing an appeal before the Tribunal wherein it was held
that services of supervision of stuffing of goods in containers was
rendered by the concerned Officer within his range only i.e., within his
normal place of work, as such, condition for levy of MOT charges was
not satisfied and accordingly dismissed the appeal.
3. Aggrieved with the same, present appeal is filed.
4. At the time of admission of appeal, following question of law has
been determined by this court:-
"Whether the Central Excise Officer discharging his
duties as a Customs Officer, in the factory premises of the
assessee, could be said to be discharging such functions in
a „Customs Area‟ as defined in Sub-Section 11 of Section
2 of the Customs Act, 1962?"
5. Learned counsel for the appellant has contended that the normal
place of work of Central Excise Officer is his office only. It is submitted
that vide para 1.2, Part II, Chapter 18 of CBEC‟s Excise Manual of
Supplementary Instructions, it is provided that if a manufacturer or
exporter requisitions service of Central Excise Officers for supervision
and examination of export cargo and stuffing in containers at his
premises, such officers discharge the functions of Customs Officers. It
is contended that in the present case the stuffing was done in the factory
of respondent by the Central Excise Officer, as such, the Central Excise
Officer works as a Customs Officer also. It is submitted that such a
facility has been extended to avoid hassles of examination and stuffing of
cargo at port. It is contended that in the present case, the Central Excise
Officer has discharged his duty in the factory premises of respondent, the
Central Excise Officer has functioned as a "Customs Officer", as such,
MOT is leviable.
6. On the other hand, learned counsel for the respondent has
submitted that the Central Excise Officer in his capacity as a Custom
Officer has rendered the services of stuffing of goods in containers within
his range only, i.e., in the factory falling within his range only, as such,
same comes within his normal place of work and no fee is payable.
7. The overtime fee is collected under Section 36 of the Customs Act
read with Customs (Fees for Rendering Services by Customs Officers)
Regulations, 1998 made thereunder. Section 36 of the Customs Act
allows loading/unloading of imported/export cargo from any vessel
beyond working hours on any working day or on holiday only on
payment of prescribed fees. The rate and the manner of collection of
such fee is given in the aforesaid Regulations of 1998.
8. In the present case, it is an admitted position that stuffing work
was done in the factory of respondent under the supervision of
jurisdictional Central Range Officer during working hours only. The
place of working/supervision was at the factory of the respondent which
is at Mayapuri. Learned counsel for the respondent has pointed out that
as per Notification No.14/2002-CE(NT) dated 08.03.2002 as amended by
Notification No.22/2002-CE(NT) dated 04.06.2002, the jurisdiction of
Delhi II, Range 26 of Central Excise division-V includes Mayapuri Indl.
Area Ph.-II where the factory of respondent is located, the services were
rendered by the officer within his range only. The same fell within the
jurisdiction of the Central Excise Range Officer who supervised the
work. Chapter 13 of the CBEC‟s Customs Manual deals with "Merchant
Overtime Fee" wherein it is provided that if services are rendered by the
Customs Officer at a place which is not his normal place of work or a
place beyond the Customs area, overtime is levied even during the normal
working hours.
9. In the present case, none of the conditions for levy of MOT is
satisfied.
10. Accordingly, we answer the substantial question of law in the
affirmative. The appeal is accordingly dismissed with no order as to
costs.
VEENA BIRBAL, J
BADAR DURREZ AHMED, J
April 22, 2013
ssb
