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<h1>Tribunal Upheld Duty Demand & Penalties for Tariff Item 15C Products. Remand for Goods Produced Without Power. Confiscation & Licensing Penalties Upheld.</h1> The Tribunal upheld duty demand and penalty imposition on the appellants for manufacturing products falling under Tariff Item 15C. The matter of duty ... Starch gums, being modified starches Issues:- Whether the products manufactured by the appellants fall under Tariff Item 15C and are liable for duty.- Whether duty is demandable under Rule 9(2) due to suppression of manufacturing activity.- Whether the seized goods are liable for confiscation and penalty imposition.Analysis:Issue 1:The case involved determining if the products manufactured by the appellants fell under Tariff Item 15C and were subject to duty. The Central Excise Officers found the appellants manufacturing starch gum with and without the aid of power. The Collector of Central Excise held that the products fell under Tariff Item 15C, and duty was leviable. The Tribunal rejected the appellants' argument that duty had already been paid on the starch used, stating that modified starches, including those produced by the appellants, were liable for duty under Item 15C. The Tribunal referenced a larger bench judgment and Supreme Court decision to support their conclusion.Issue 2:Regarding duty demand under Rule 9(2) due to suppression of manufacturing activity, the Collector found that the appellants had concealed their manufacturing operations from the department. Duty was demanded under Rule 9(2), and a penalty was imposed under Rule 173Q. The Tribunal upheld the duty demand and penalty imposition, emphasizing the obligation to pay duty on modified starches falling under Tariff Item 15C.Issue 3:The question of confiscation and penalty imposition on seized goods was also addressed. The seized goods were found liable for confiscation, but upon payment of a fine, they were released. The Tribunal remanded the matter to the adjudicating authority to determine the duty liability for the goods manufactured without the aid of power. The appellants were penalized for contravention of licensing rules and required to pay a penalty for the same.In conclusion, the Tribunal upheld the duty demand and penalty imposition on the appellants for manufacturing products falling under Tariff Item 15C. The matter of duty liability for goods manufactured without the aid of power was remanded for further assessment by the adjudicating authority. The confiscation of goods and penalty imposition for contravention of licensing rules were also upheld.
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