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E/20098/2021

CUSTOMS, EXCISE & SERVICE TAX APPELLATE

TRIBUNAL

BANGALORE

REGIONAL BENCH - COURT NO. 1

Central Excise Appeal No.20098 of 2021

(Arising out of Order-in-Appeal No.CAL-EXCUS-000-APP-365/2020

dated 20.10.2020 passed by the Commissioner of Central Tax,

Central Excise and Cust oms (Appeals), Kochi.)

M/s. Koso India (P) Ltd.

Industiral Development Area

Appellant(s)

Kanjikode West,

Palakkad, Kerala-678 623.

VERSUS

Commissioner of Central Tax

And Central Excise, Calicut

Respondent(s)

C.R.Building, Mananchira,

Calicut-673 001,

Kerala.

APPEARANCE:

Mr. Raghavendra, Advocate for the Appellant.

Mr. Vinod Kumar Garhwal, Superintendent (AR) for the Respondent.

CORAM: HON’BLE MR. D.M. MISRA, MEMBER (JUDICIAL)

HON’BLE MRS. R. BHAGYA DEVI, MEMBER

(TECHNICAL)

Final Order No. 20524 /2026

DATE OF HEARING: 04.02.2026

DATE OF DECISION: 04.02.2026

PER: D.M. MISRA

This is an appeal filed against Order-in-Appeal No.CAL-

EXCUS-000-APP-365/2020 dated 20.10.2020 passed by the

Commissioner of Central Tax, Central Excise and Customs

(Appeals), Cochin.

2. Briefly stated the facts of the case are that the appellant

are engaged in the manufacture of control valves failing under

Chapter 84 of Central Excise Tariff Act, 1985. Alleging that the

appellant had availed / utilised irregular cenvat credit during the

period 2012-13 on stock transferred goods to their Nashik Unit,

E/20098/2021

investigation was initiated and on completion of the

investigation, show-cause notice was issued to them on

31.01.2018 demanding an amount of Rs.53,09,062/- being

excess amount collected from their sister concern during the

period 2012-13 to 2016-17 under Section 11D(2) of the Central

Excise Act, 1944 (CEA, 1944) with interest and penalty. On

adjudication, the demand was confirmed with interest and

penalty. On appeal by the appellant, the learned

Commissioner(Appeal) rejected their appeal. Hence, the present

appeal.

3.1. At the outset, the learned advocate for the appellant has

submitted that they have factories situated in Kanjikode,

Palakkad and Nashik. On cessation of their activities at

Kanjikode unit, they have cleared the inputs / raw materials and

semi-finished goods to their Nashik Unit on ‘stock transfer’ basis

‘as such’ at a price higher than the purchase value by adding

10% of the basic cost of production as value addition after

discharging excise duty on the arrived value through their cenvat

credit account during the relevant period instead debiting the

cenvat credit availed at the time of receipt of such inputs in

factory. He has submitted that whatever duty has been paid in

excess on the value calculated on the clearances of the inputs /

raw materials ‘as such’ has been paid to the Government even

though the excess amount has been collected from their sister

concern.

3.2. It is his contention that the transaction with their sister

concern in no way would lead to the conclusion that the

appellant have retained the excess duty in the guise of collection

of excise duty from their sister concern. Referring to Circular

No.651/42/2002-CX dated 07.08.2002, he has submitted that

the amount which has been collected, if deposited to the

Government, Section 11D shall not apply. Further, he has

placed reliance on the judgment of the Tribunal in the case of

E/20098/2021

CCE, Belapur Vs. PRP Wire Ropes [2017(350) ELT 439 (Tri.

Mumbai)] and referred to the following judgments:-

i. Sharada Polymers (P) Ltd. Vs. CCE, Bangalore [2006(206) ELT

550 (Tri. Bang.)]

ii. Lamicoat International Pvt. Ltd. Vs. CCE, Noida [2015(324)

ELT 411 (Tri. Del.)]

iii. Viraj Impo & Expo Ltd. Vs. CCE, Thane-II [2006(205) ELT 364

(Tri. Mumbai)] – Upheld by Bombay High Court in 2009(234)

ELT A120(Bom.).

iv. Uttam Galva Steels Ltd. Vs. CCE, Raigad [2016(336) ELT 81

(Tri. Mumbai)]

v. Asian Colour Coated Ispat Ltd. Vs. CCE, Delhi-III [2015(317)

ELT 538 (Tri. Del.)

Vi. CCE, Belapur Vs. PRP Wire Ropes [2017(350) ELT 439 (Tri.

Mumbai)]

vii. CCE, Thane-II Vs. Angadpal Industries Ltd. [2013(12) TMI

508 – CESTAT MUMBAI

3.3. The learned advocate for the appellant