1995 (5) TMI 244

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....cate, for the Appellant. Shri J.P. Singh, JDR, for the Respondent. [Order per : K.S. Venkataramani, Member (T)]. - The brief facts relating to the appeal are as follows : 2. The appellants manufacture "mill wrapper" which is a variety of packing and wrapping paper which is captively consumed. The mill wrapper is used in packing and wrapping of the different varieties of paper manu....

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....rcially sold. Thus the mill wrapper they say is used in or in relation to the manufacture of paper. The reel core is an intermediate product which comes into existence and is used in the manufacture of paper. 4. Proceedings were initiated against the appellants by issue of show cause notice dated 11-9-88 in which it was alleged that reel core is packing material on which paper is wound and....

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....irming the demand of duty of Rs. 6,74,541.00 and also imposing a penalty of Rs. 20,000.00 on the appellants. In so confirming the allegations in the show cause notice, the Collector relied on the Tribunal decision in the case of Collector of Central Excise v. Star Paper Mills - 1988 (38) E.L.T. 294 holding that reel core used for winding of paper is not a component part but is only packing materia....

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....ribunal decision in the case of Ponds India Ltd. (supra) has also been set aside by the Madras High Court in the case of Ponds India Ltd. v. C.C.E. - 1993 (63) E.L.T. 3. Further, the ld. Counsel referred to the Department's own understanding as reflected in a clarification given by the Ministry of Finance, Deptt. of Revenue Circular No. 33/33/94-CX 8, dated 4-5-94 in which it is stated that in sit....