1996 (5) TMI 237 - AT - Central Excise

Granite stone cutting ruled as manufacture subject to excise duty, remanded for further review

The Tribunal upheld that cutting and polishing of granite stones constitute manufacture, subject to excise duty. However, issues of time bar and the ... Manufacture Issues:Challenge to confirmation of duty amount for clearances of polished granite slabs, confiscation of goods, imposition of penalty, determination of whether cutting and polishing of granite stones amounts to manufacture, consideration of time bar for demands, and duty computation for exported goods.Confirmation of Duty Amount and Confiscation:The appeal challenges the confirmation of duty amount for clearances of polished granite slabs under Chapter Heading No. 6807.00 without payment of duty. The Collector ordered the confiscation of seized slabs and imposed a penalty under various Central Excise Rules. The appellants argued that the cutting and polishing process should be considered as 'Handicraft items' exempt from excise duty, citing specific notifications. However, the Collector rejected these arguments and held that the process amounted to manufacture and duty was leviable, contravening several Central Excise Rules.Time Bar and Duty Computation:The appellants contended that the demands were time-barred as they had informed the department about their manufacturing activity. They also raised issues regarding duty computation and duty waiver for exported goods. The Learned Advocate referenced previous judgments to support their arguments. The department disputed the genuineness of the appellants' letter informing about their activity and argued that duty was still payable due to non-compliance with excise procedures.Judgment and Remand:The Tribunal considered previous judgments establishing that cutting and polishing of granite stones amount to manufacture, attracting excise duty. However, the issue of time bar and the authenticity of the appellants' letter were not adequately addressed by the Collector. Therefore, the matter was remanded back to the Commissioner for reconsideration. The Commissioner was directed to examine the plea of limitation, duty valuation, and remission for exported items, ensuring due notice to the appellants. Duty already deposited and bank guarantees provided would remain as security during the reevaluation process. The impugned order was set aside for de novo consideration by the Commissioner.