IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL EASTERN ZONAL BENCH: KOLKATA REGIONAL BENCH – COURT NO. 1 (Arising out of Order-in-Original No. 01/M.P./Ayukt/2018 dated 09.01.2018 passed by the Commissioner of Central Tax and Central Excise, Patna-II Commissionerate) M/s. Ornate Labs Private Limited : Appellant “Bela Industrial Estate”, Bela Chapra Industrial Complex, M uzaffarpur – 842 005 VERSUS Commissioner of Central Tax & Central Excise : Respondent Patna-II Commissionerate APPEARANCE:

Shri Ankit Kanodia and Ms. Megha Agarwal, both Advocates, For the Appellant Shri Prasenjit Das, Authorized Representative, For the Respondent CORAM:

HON’BLE SHRI ASHOK JINDAL, MEMBER (JUDICIAL)

HON’BLE SHRI K. ANPAZHAKAN, MEMBER (TECHNICAL)

FINAL ORDER NO. 75289 / 2026 DATE OF HEARING: 20.02.2026 DATE OF DECISION: 24.02.2026 ORDER: [PER SHRI K. ANPAZHAKAN]

The present appeal has been filed against the Order-in-Original No. 01/MP/AYUKT/2018 dated 05.01.2018, passed by the Ld. Commissioner of Central Tax & Central Excise, Patna-II, wherein the Ld. Commissioner has confirmed the demand of central excise duty amounting to Rs. 3,13,30,403/- along with interest. In the impugned order, a penalty equal to the demand of duty confirmed has been imposed under 11AC of the Central Excise Act, 1944 and a penalty of Rs.5,000/- has been imposed under Rule 27 of the Central Excise Rules, 2002.

2. The facts of the case are that M/s. Ornate Labs Pvt. Ltd. (hereinafter referred to as the “appellant”), is a private limited company incorporated under the Companies Act, 1956 having its principal place of business registered at Bela Industrial Estate, Bela Chapra Industrial Complex, Muzaffarpur – 842 005. The appellant is engaged in the business of manufacturing of medicament falling under Chapter 30 of the Central Excise Tariff Act, 1985 having Central Excise Registration No. AACCM6171DXM001 for such manufacture and sale of medicaments.

2.1. A Thematic Audit was conducted by CERA, on the books of accounts of the appellant covering the period 2011-12 to 2013-14, on the theme of Central Excise Exemption availed by SSI units. During the course of audit, officers of CERA received 24 sample invoices from the appellant. On analysis of the said 24 invoices, it was observed by CERA that the appellant had not cleared the goods as per the provisions laid down in Section 4A of the Central Excise Act, 1944. It was alleged that the appellant was taking into account much lesser value for the purpose of levy and payment of central excise duty than the declared MRP of the medicines less prescribed abatement of 35% of MRP value, resulting in undervaluation of goods and probable short payment of central excise duty to the tune of Rs. 205.33 lakhs. It was also observed by CERA that the average sale price of unit product manufactured by the appellant during the period from April, 2013 to December, 2013 was much higher than the unit sale price during the period from January, 2014 to March, 2014 resulting into probable escapement of central excise duty to the tune of Rs.

83.33 lakhs.

2.2. On the basis of the above findings of the Audit and subsequent investigation conducted by the Department, a Demand cum Show Cause Notice bearing C.No. V-15/M’Pur/Show Cause Notice- Cell/Adjn/2015/6890 dated 06.07.2016 was issued to the appellant, demanding Central Excise Duty of Rs.3,22,30,403/-, along with interest and penalties.

2.3. The said Notice was adjudicated by the Ld. Commissioner vide the impugned order dated 05.01.2018, confirming the demands of central excise duty, along with interest and penalties, by denying the benefit of exemption Notification No. 08/2003-CE dated 01.03.2003 to the appellant for the period from

2013-14 to 2015-16.

2.4. Aggrieved by the confirmation of central excise duty, along with interest and penalties thereon, the appellant has filed this appeal.

3. During the course of hearing, the Ld. Counsel appearing on behalf of the appellant submitted that the sample invoices