TaxTMI 
TaxTMI 
2010 (7) TMI 973
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....ter Heading 2302. They are also manufacturing Chlorotetracyclin HCL. As per the Revenue, the said Chlorotetracylin HCL manufactured by the assessee is being used by them in the manufacture of animal food supplement and inasmuch as the same is not used in antibiotics, the same is not classifiable under Chapter Heading 2941.30 of Central Excise Tariff Act, 1985, but would fall under Heading 2942.00, attracting the duty rate of 15% ad valorem plus special excise duty. As the final product i.e. animal food supplement is fully exempted, the duty at the appropriate on Chlorotetracylin-HCL is required to be discharged by the assessee. 3. On the above basis, 10 show cause notices were issued to the assessee demanding duty of Rs. 1,04,07,032....
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....l to the seeds for fermentation of Chlorotetracylin (CTC) in the fermenter. After the fermentation is over and CTC is formed in the fermentive mash, the unit may use this mash for the manufacture of Animal Food Supplement or CTC HCL. To manufacture the Animal Food Supplement, lime is added in the fermentive mash in mash treatment tank and the filtrate is separated out of it in rotary vacuum filter. This filtrate is taken for affluent treatment and the wet animal food ingredient (AFI) cake which remains in the filter is taken to tray drier for drying. Thus the dry AFI cake is obtained which is taken in pulverizer and blender where rice husk and groundnut oil is added to make it palatable. After blending it is screened and packed. This packed....
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....istant Commissioner, Revenue filed an appeal before Commissioner (Appeals). The department's main contention was that the appellant themselves admitted that they have used CTC-HCL in the manufacture of animal food supplement vide their letter dated 4-10-1988. As such, it was the Revenue's contention that the findings of the adjudicating authority that CTC-HCL never stands used by them in the manufacture of animal food supplement were factually incorrect. 7. The assessee filed cross-objections before Commissioner (Appeals) and clarified that their letter dated 4-10-1988 refers to 12,425.8 Kgs. HCL contained in animal food supplement from June 1987 to August 1988. While clarifying the same they submitted that :- "They had actually ....
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.... of animal food supplement then the department should have explained the manufacturing process and indicated the stage in the process where CTC-HCL is used. As this has not been done, there is nothing on record on the basis of which it can be concluded that CTC-HCL is actually used in manufacture of animal food supplement. As against this lack of evidence to support the stand taken in the department's application, there is strong evidence available to support the pleas of the respondents In the form of personal observation of the Assistant Collector. 7. The points in the department's application regarding letter dated 10-4-1989, mentioned in the application is also not correct. It has been mentioned in the application that in Para 8....