TaxTMI 
TaxTMI 
2015 (9) TMI 1206
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..... The appellant manufacture bulk products like Niacin falling under Chapter Heading 29.36 of the Central Excise Tariff Act, 1985. They also manufacture Niacin (Feed Grade) which is used in animal feed and classify it under Tariff Item 23099090 and clear the same at nil rate of duty. Whereas Niacin is 99% pure and used in pharmaceutical formulations as vitamin the purity of Niacin (Feed Grade) is 95% and it is further mixed with wheat powder for use as animal feed. Under the impugned order, the Commissioner classified the Niacin Feed Grade under Tariff Item 29362920 and confirmed the duty demand of Rs. 65,43,700/- invoking the extended time period. He also imposed equivalent penalty under Section 11AC of the Act. The goods valued at Rs. 6,54....
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....e correct classification. They started manufacturing Niacin Feed Grade from December 2008 and cleared the same without payment of duty. The appellant cleared the exempted products on reversal Cenvat Credit under Rule 6 of the Cenvat Credit Rules. The E.R. 1 returns show that during the period December 2008 to May 2011, the description of the goods was shown as Niacin, (Feed Grade). 5. The Ld. AR contended that Chapter Note 1 to Chapter 23 states that Heading 2309 includes products of a kind used in animal feeding, obtained by processing vegetable or animal materials to such an extent that they have lost the essential characteristics of the original material. Whereas the product in dispute is obtained by a chemical process. He further state....
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.... The Chapter Note 1 to Chapter 23 states that "Heading 2309 includes products of a kind used in animal feeding............... obtained by processing vegetable or animal materials to such an extent that they have lost the essential characteristics of the original material........" On reading this note itself, we would disagree with the appellant that their product is covered under heading 2309. Their product is not obtained by processing vegetable of animal material. Their product is obtained from chemicals i.e. Beta Picoline, Sulphuric Acid, Nitric Acid. Therefore Heading 2309 which covers products of a kind used in animal feeding, can by no means include Niacin. 6.2 We also find that Tariff Item 29362920 specifically covers Nicotinic acid....
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....ods that is Niacin Feed Grade at price assuming that no duty is payable. The Commissioner has rightly relied on the case of Asian Alloys Ltd. Vs. Commissioner of Central Excise, Delhi 2006 (203) ELT 252 (Tri. - Del.) which held that when the appellant had itself proceeded on the basis that no duty was payable there was no question of its having recovered any "cum-duty" price from the customers. Therefore, the appellant's plea is rejected. 7. The show cause notice was issued on 23.8.2011 for the period December 2008 to May 2011 by invoking the extended time period under proviso to Section 11 A (1). We see no justification to invoke the extended time period. The case is a matter of interpretation. We have seen the ER.1 returns for the sa....