TaxTMI 
TaxTMI 
2010 (8) TMI 280
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....case is whether appellants are liable to pay central excise duty on the intermediate goods namely partially oriented yarn of PPMF yarn of 385 deniers used in the manufacture of twisted yarn of 210 deniers. Duty demand of Rs. 65,46,595/- has been confirmed against the appellants and a penalty of Rs. 14,70,100/- has also been imposed on the appellant company. Further a penalty of Rs. 5,00,000/- has also been imposed on the Director, Shri Shankarlal Somani. 2. The learned advocate on behalf of the appellants submitted that the sole ground on the basis of which demand has been confirmed is that the appellants were getting 380 denier PPMF converted to 210 denier PPFY on job work basis from M/s. Gujarat Synthetic Oxide Lakhani Textiles e....
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.... 385 deniers. Further he also submitted that appellants had sent the goods for job work for some time which would show that goods were capable of being sold. He drew our observation to the discussion about process only and the manufacturing process of the Commissioner and submitted that this would clearly show that the process fulfils the definition of manufacture. 4. We have considered the submissions. Before we proceed further it would be worthwhile to reproduce the manufacturing process as outlined by the Commissioner in the impugned order. "PP POY MULTIFILAMENTS YARN - PROCESS FLOW "Virgin Chips from chips room are carried to amin Silo through a dust separator (to remove dirt, dust and other foreign particles) by suction.....
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....r quality control, denier verification, elongation, strength etc. are carried out and the material is packed in boxes and also the fact that earlier the manufacturer was sending it for job work would show that the product has an independent name, character and use. Further in their own declaration under Rule 173B of Central Excise Rules, 1994, Modvat declaration and RT-12 appellants have listed the product for relevant purposes. The only ground canvassed by the appellant in support of the contention is that the department has not proved marketability. It is well settled that it is not necessary to show that goods are marketed as such. What is required to be shown is they are marketable. In the case of CIPLA cited by the appellants, the appe....
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....the process of manufacture does not amount to manufacture by showing that the product does not fulfill one of the three requirements. The appellants have simply chosen to claim that department has not produced enough evidence which was not the case in both the decisions cited by the appellants. In view of the above position we find that on merits appellants do not have a case. 6. However when it comes to limitation, we find that the appellants had filed a classification declaration under Rule 173B wherein they had mentioned PPMF yarn and claimed exemption under Notification No. 67/95 dated 16-3-95. Further they had also filed declarations for availment of modvat credit on 23-7-96 and there PPMF (POY) was also mentioned. In the RT-1....