TaxTMI 
TaxTMI 
2006 (10) TMI 46
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....04 to February 2005 1,77,01,910/- 88,50,000/- 18/06 dated 24-3-06 KTV Oil Mills E/388/06 June 2004 to August 2004 17,99,894/- 5,00,000/- 46/2005 dated 30-5-05 KTV Oil Mills E/692/05 August 2003 to October 2003 7,66,172/- 10,000/- 2.The common issues arising for decision are, (i)Whether packing and labelling of refined edible oil in bulk into retail packs amount to manufacture in terms of Note 4 to Chapter 15 of First Schedule to the CETA 1985. (ii)If the answer to the above question is yes, whether such repacked and labelled goods are eligible for exemption in terms of Notification No. 6/02-CE dated 1-3-2002 if the input oil was cleared under DEPB scheme availing exemption? 3.As the seco....
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....d sold. The pouches bore on them details such as description of the contents, quantity and name of the manufacturer. 7.RHFL cleared the impugned goods during September 2004 to February 2005. After issuing Show Cause Notice and hearing the party, the Commissioner decided that the impugned goods had been manufactured in terms of clause (ii) of Section 2(f) of the Central Excise Act, 1944 read with Note 4 to Chapter 15. As per the said clause (ii), "manufacture" meant any process specified in relation to any goods in the Section or Chapter notes to the First Schedule to the Central Excise Tariff Act, 1985 as amounting to manufacture. In the instant case, the relevant Note 4 to Chapter 15 reads as under : "4.In relation to the products of....
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....involve repacking from bulk packs to render them ready for sale and were not therefore relevant to the case under adjudication. He observed that in the instant case, Palmolein consignments not ready for marketing had been repacked and labelled to render them marketable. Therefore, it was concluded that as per Chapter Note 4 to Chapter 15, the impugned goods had been manufactured and duty was demanded as the input oil had been imported under DEPB scheme and cleared without payment of additional customs duty. 9.Before us the following legal arguments were made by the learned Counsel appearing for the appellants. As per Chapter Note 4 to Chapter 15, only labelling or relabelling of goods repacked from bulk packs to smaller packs amounted....
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....e orders, the Commissioner has found the activity undertaken by Nestle to be any other treatment. The word "other" in each of the notes clearly refers to a process other than those earlier specified in them..............". The appellants had not undertaken any activity other than packing which would be covered by 'any other treatment' referred to in the Chapter Note. The learned Counsel cited the following observation of the Tribunal in the Ammonia Supply Company case in support of his argument. "In relation to products of this Chapter, labelling or re-labelling of containers and repacking from bulk packs to retail packs, or the adoption of any other treatment to render the product marketable to the consumer, shall amount to manufactu....
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.... that in the Ammonia Supply Company case, the facts were different from that of the subject case. In that case Ammonia gas in bulk was packed in returnable cylinders and the labelling of cylinders was disputed. In the instant case the appellants had registered as assessee as per the Central Excise Rules for the impugned activity and the present controversy was raised only when they were called upon to pay duty on repacking of imported goods cleared under DEPB. 12.We have carefully considered the facts and arguments. There is no dispute as regards the facts of the case. The Note 10 of Chapter 28 reads as follows : "In relation to products of this Chapter, labelling or re-labelling of containers and repacking from bulk packs to re....