TaxTMI 
TaxTMI 
TaxTMI 
2014 (12) TMI 696
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....luminium castings in question were tailored for spring brake chambers ordered by the Motor Vehicle factory of the defence Ministry and that these castings were not fit for use by Private Motor vehicle Manufacturers? 2. Whether on the facts and circumstances of the case, the Tribunal is right in law in holding that the marketing of the aluminium castings manufactured by the 1st respondent and transfer of information of the same to other persons were forbidden under the agreement entered into between the 1st respondent and the Defence Ministry under the provisions of official Secret Act? 3. Whether on the facts and circumstances of the case, the Tribunal is right in law in holding that the aluminium castings in question were not capable of ....
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....to ingots. During the course of manufacture of final product (spring brake chamber) out of aluminium ingots in the appellant's factory, aluminium castings emerged as an intermediate, which were captively consumed in the manufacture of the final product. This captive clearance of the castings was made without payment of duty by the first respondent by availing the benefit of Notification No.217/86-CE, which granted the facility of duty-free procurement of job-worked goods and Notification No.67/95-CE, which granted exemption from payment of duty on inputs manufactured and captively consumed in the factory of production of final product. The final product, namely, spring brake chambers, was cleared from the vehicle factory without payment....
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.... were not fit for use by private motor vehicle manufacturers and there is no market for these castings and even transfer of information about the same to other persons were forbidden under the agreement between the first respondent and the Defence Ministry. The Tribunal further held that the aluminium castings in question were not capable of being marketed and hence the commodity does not suffer any duty of excise. Accordingly, the Tribunal set aside the order of the Commissioner (Appeals), thereby, confirmed the order of the Original Authority. Aggrieved by the said order of the Tribunal, the Revenue is before this Court raising the above-mentioned substantial questions of law. 7. Admittedly, the facts are not in dispute. It is seen that ....
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....applicability of the notification but confined to examination of marketability aspect alone. It is an accepted fact that the final product namely, Spring Brake Actuation equipment is cleared without payment of duty under Notification No.239/86 and 64/95. In the manufacture of the above said final product, the aluminium castings are used. These castings are manufactured in the factory premises itself and captively consumed. For such captive consumption, Notification No.217/86 and 67/95 have been availed by the respondent. This is not proper in my view as these two notifications are not applicable when the final product is exempted. For the sake of easy understanding, let me reproduce the relevant portion of the notification as under:- "Exem....