2004 (7) TMI 422 - AT - Central Excise

Appellate Tribunal CESTAT Mumbai Waives Pre-Deposit Requirement for Appellants in Duty Dispute

The Appellate Tribunal CESTAT, Mumbai, waived the pre-deposit requirement on duty and penalty for the appellants, contingent upon them furnishing a Bank ... Stay/Dispensation of pre-deposit - Job work - Manufacture Issues:Main issue: Whether activities undertaken by the appellants through their job workers in marketing imported shirts amount to manufacture under Chapter Note 4 to Chapter 62 of the Central Excise Tariff.Analysis:The main issue in the appeals before the Appellate Tribunal CESTAT, Mumbai was to determine whether the activities carried out by the appellants through their job workers in the marketing of imported shirts constituted 'manufacture' as per Chapter Note 4 to Chapter 62 of the Central Excise Tariff. The Tribunal referred to the decision in the case of Ammonia Supply Company v. C.C.E., New Delhi, where it was established that labelling or re-labelling, along with re-packing from bulk packs to retail packs, must be done together to meet the requirements of the Chapter Note. Additionally, the Tribunal considered the decision in the case of Johnson & Johnson Ltd. v. C.C.E., Mumbai-IV. In light of these precedents, the Tribunal found the advocate's offer to submit a Bank Guarantee for the differential duty amounts of Rs. 2,08,47,542/- and Rs. 7,89,625/- to be reasonable and fair.The Tribunal, comprising of Shri Krishna Kumar and C. Satapathy, JJ., decided to waive the pre-deposit requirement on duty and penalty, contingent upon the appellants furnishing a Bank Guarantee for the specified differential duty amounts by a set deadline. The appellants were instructed to provide proof of compliance by a certain date, with the regular hearing of the case scheduled for a later date. The Tribunal emphasized the need for the appellants to receive a copy of the order promptly to facilitate the procurement of the necessary Bank Guarantee for the differential duty amounts.In conclusion, the Appellate Tribunal CESTAT, Mumbai, through a detailed analysis and reference to relevant legal precedents, resolved the issue concerning the manufacturing activities related to the marketing of imported shirts by the appellants. The Tribunal's decision to waive the pre-deposit requirement on duty and penalty, subject to the furnishing of a Bank Guarantee, demonstrated a balanced approach to the matter, ensuring fairness and compliance with legal obligations.