The Delhi bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that the pendants are jewellery, not gold coins rather than gold coins, rejecting an appellant’s claim for an excise duty exemption despite 24-Carat Purity Claim.
The bench of Binu Tamta (Judicial Member) and Hemambika R. Priya (Technical Member) has observed that Chapter Note 9 clearly included ‘pendants’ as articles of jewellery and the contention of the appellant that it does not cover pendant of 24 CARAT within its purview is misleading and unsustainable as nowhere in the Chapter Note or the Heading, the jewellery is distinguishable on the basis of purity of gold. The appellant is deliberately reading the words, “24 carat in the chapter note, which is not permissible”.
The bench stated that as per the trade practice, it is well known that no articles of jewellery can be manufactured of 24 CARAT purity gold. The appellant is not entitled to claim any exemption on the articles described as ‘Pendants’ and is, therefore, liable to pay excise duty.
The appellant/assessee is engaged in the manufacture of articles of jewellery falling under Chapter Heading 7113 of CETA. Investigations revealed that the appellant had not paid central excise duty on the articles of jewellery manufactured and cleared by them during the period 1.03.2016 to 30.0 6.2017.
They were not charging central excise duty from the customers till December 2016. From 01.01.2017, the appellant collected the central excise duty from the customers on the invoices and paid the same under GAR-7 challans, however, they did not file any central excise returns during the period 1.03.2016 to 30.06.2017.
The evasion of central excise duty amounted to Rs.5,45,22,719. During investigation, the appellant deposited the amount of Rs.4,93,99,620 and requested for closure of the investigation by waiver of show cause notice.
The appellant neither filed reply to the show cause notice nor appeared for personal hearing. On adjudication, the demand was confirmed by the impugned order. Hence, the present appeals have been filed before this Tribunal.
The tribunal held that the invoices for sale from Chandni Chowk branch and Karol Bagh branch with the description of the goods as gold ornaments/gold chain in respect of which the appellant had claimed exemption from Central excise duty was admitted by Siri Ajay Goyal that they had mistakenly claimed exemption on the clearance under the said invoices and accepted their duty liability. The goods under and these invoices were covered under the definition of articles of gold jewellery. The excise duty has been rightly confirmed on account of non-inclusion of the value of goods sold on invoices having description “24 Carat Ornaments/Gold Chain” valued during the period from 1.03.2016 to 30.06.2017.
Case Details
Case Title: M/S. P.P. Jewellers Pvt. Ltd. Versus Principal Commissioner, Central Tax, And Cgst Commissionerate
Case No.: Excise Appeal No. 52154 Of 2022
Date: 28/03/2025
Counsel For Appellant: Jitendra Singh
Counsel For Respondent: Rakesh Agarwal
