TaxTMI 
TaxTMI 
TaxTMI 
2017 (7) TMI 887
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.... issued to demand excise duty on the said clearance of basmati rice, broken rice and brown rice cleared into DTA. The show cause notices were adjudicated and the demands were confirmed and penalties on both the appellants were imposed. Aggrieved from the said order, appellants are before us. 3. The Ld. Counsel for the appellants submits that a similar issue came up before this Tribunal in the case of Dunar Food Ltd. Vs. CCE - 2016-TIOL-2999-CESTAT-Chd wherein this Tribunal held that the conversion of paddy into rice does not amount to manufacture and rice/rice bran/broken rice are not excisable goods in terms of Section 2(d) of the Act. The said view of this Tribunal has been affirmed by the Hon'ble Apex Court reported in 2017 at 2017-TIOL-155-SC-Cx, therefore, impugned orders are to be set aside. 4. On the other hand Ld. AR reiterated the findings of the impugned orders. 5. Heard both the sides and considered the submissions. 6. Considering that the facts of the case are not in dispute and only legal question has been raised by the Ld. Counsel for the appellants that; (A) whether the conversion of paddy into rice amounts to manufacture as per Section 2(f) of the Act, and; (B....
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....operation and such changes as are brought about in the product are an outcome of agricultural operation. Both rice and husk remain in their natural form as a result of dehusking and are covered by the term 'agricultural product'. 6. The High Court has also formed an opinion that Section 35C of the Income-tax Act, 1961, was designed to encourage development of agriculture and, therefore, gave a weighted deduction in respect of expenditure incurred in providing to the agriculturists services and facilities specified therein. The term 'agricultural product' or 'product of agriculture' is required to be construed liberally so as to include not merely the primary product as it actually grows, but also a product which undergoes a simple operation so as to make it more saleable or more useable. The rice and the husk though separated remain as they were produced and hence continued to be agricultural product or product of agriculture'. 30. As the Hon'ble Apex Court has held that conversion of paddy into rice is not a distinct operation and the rice and husk remain in their natural form as a result of dehusking and are covered by the term agricultural produc....
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....ariff in 2008 cut flowers remains a non-excisable goods. If the goods are non-excisable goods, the question of levy of excise duty would not arise at all. Therefore, there is absolutely no merit in the appeals filed by Revenue. Accordingly, the same are dismissed. 35. We further find in the case of Ahmedabad Electricity Co.Ltd. (supra), the Hon'ble Apex Court has observed as under: "13....... Therefore, simply because goods find mention in one of the entries of the First Schedule does not mean that they become liable for payment of excise duty. Goods have to satisfy the test of being produced or manufactured in India." 36. We further find in the case of Wimco Ltd. (supra), the Hon'ble Apex Court has observed as under: "12. It is to be noted that merely because there is a tariff entry it does not become excisable unless manufacture is involved." 37. We also take note of the fact in the case of Nahar Industrial Enterprises Ltd., the Hon'ble Apex Court has observed as under: "9. Contrary to what has been contended by the Union of India, a bare reading of the Notification No. 8/97-C.E. dated 1-3-1997 and as amended by Notification 11/2000-C.E. dated 1-3-2000 shows that there ....
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.... is measured. In this case a tax imposed by State Government on buildings on the basis of capital value of the Assets was held to be valid by the Supreme Court holding that for the purpose of levying tax under Entry No.49, List II of the Seventh Schedule to the Constitution, the State Legislature may adopt annual or capital value of the building and this will not make it a tax falling within the scope of Entry 86 of List I of the Seventh Schedule. Similar views were held by the Supreme Court in the case of Hingir - Rampur Coal Co. Ltd. v. State of Orissa, AIR - 1961 SC 459 wherein it was held that the method in which the fee is recovered is a matter of convenience and by itself it cannot fix upon the levy the character of the duty of excise. In this case a fee was levied by the State of Orissa on the basis of 5% of the value of the minerals at the pits mouth. It was challenged that the CESS was in the nature of duty of excise. The Supreme Court did not agree with this contention holding that "it is difficult to appreciate how the method adopted by the Legislature in recovering the impost can alter its character. In our opinion, the mere fact that the levy imposed by the impugned Ac....