TaxTMI 
TaxTMI 
2015 (4) TMI 774
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....) ORDER Per. Rakesh Kumar :- The facts leading to filing of these appeals are, in brief, as under. 1.1 M/s Dhanjjal Industries, Amritsar and M/s Guru Nanak Crushing, Amritsar are engaged in the process of crushing of manmade fabrics of sub-heading 551329 with the aid of power. In both the cases, the assessees were not paying any duty on the crushed fabrics being made by them. For the purpose of crushing, the fabrics are, first, put in the crushing machine which is fitted with an electric motor and steam is passed. The shaft of the crushing machine crushes the fabrics in pipes of the machine. After taking out the fabric from the pipe, it is put through the crushing machine at least four times. Thereafter, the fabric is passed thr....
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....of Central Excise Rules, 1944. He, however, upheld the entire duty demand alongwith interest thereon under Section 11AB and also the imposition of equal amount of penalty under Section 11AC. Against this order of the Commissioner (Appeals) appeal No. E/447/2005 has been filed. 1.3 In respect of appeal filed by M/s Guru Nagak Crushing against the order-in-original passed by the Additional Commissioner, the Commissioner (Appeals) vide order-in-appeal dated 31/3/05 while upholding the duty demand alongwith interest under Section 11AB, reduced the penalty under Section 11AC from Rs. 1,64,335/- (equal to the duty demand confirmed) to Rs. 50,000/-. Against this order of the Additional Commissioner while the assessee M/s Guru Nanak Crushing hav....
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....sable, that the Apex court in the case of CCE, Baroda vs. United Phosphorus Ltd. reported in 2000 (117) E.L.T. 529 (S.C.), has held that intermediate products coming into existence in course of manufacture of pesticides are not marketable and, hence, are not goods and would not attract excise duty, that same view has been taken by the Apex court in the case of CCE, Chandigarh vs. Steel Strips Ltd. reported in 1995 (77) E.L.T. 248 (S.C.), that it is well settled law that burden of proof of marketability is on the Department, while in this case no evidence in this regard has been produced and that in view of this, the impugned order upholding the duty demand on the crushed fabrics being made by the assesses by holding the process as amounting....
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....shing, the Commissioner (Appeals) has wrongly reduced the penalty under Section 11AC to Rs. 50,000/- while in terms of Apex court judgment in the case of Union of India vs. Dharamendra Textile Processors reported in 2008 (231) E.L.T. 3 (S.C.), once the provisions of Section 11AC are held to be applicable, penalty equal to the duty demand confirmed has to be imposed and the Adjudicating Authority has no discretion to impose a lower penalty and, hence, the order passed by the Commissioner (Appeals) in the case of M/s Guru Nanak Crushing reducing the penalty to Rs. 50,000/- is not correct. 5. We have considered the submissions from both the sides and perused the records. 6. The main point of dispute in this case is as to whether the crus....