2004 (5) TMI 438

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.... under Section 11 AC and a penalty of Rs. 1 lakh on M/s. Peddar and Peddar, other appellants, under Rule 209A for abetting duty evasion. 2. The brief facts of the case are that, the appellants M/s. Pushpam Ceramics are engaged in the manufacture of excisable goods falling under sub-heading Nos. 3207.90, 2905.90 and 3206.10. In the course of internal audit, it was revealed that the appellants were also engaged in the manufacture of an item viz., PVA liquid (Polyvinyl Alcohol Solution) on the basis of job work. As per Chapter Note 6 to Chapter 39 of the Central Excise Tariff Act, 1985 conversion of one primary form of plastic into another plastic form (such as powder into solution) amounts to manufacture. It as revealed that though the ....

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....duty that is sought to be collected at their end would be available to the customer (principal manufacturer) for availment of Modvat credit. This submission is also without any basis, for the simple reason that, the fact of conversion of PVA into PVA solution has not been disclosed to the department and therefore this was a case of suppression of facts and duty is rightly demanded by invoking extended period of limitation. 8. The concept of waiver of demand on the ground of revenue neutrality or waiver of penal action for non-payment of duty on inputs, has been clarified by the Larger Bench of the Tribunal in the case of Jay Yuhshin Ltd. v. Commissioner of Central Excise, Delhi, reported in 2000 (119) E.L.T. 718 (Tri. LB) to mean that....