TaxTMI 
TaxTMI 
1997 (9) TMI 105
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....xemption from excise duty was granted in respect of various goods including goods falling under Heading 3604.10 provided that no process in or in relation to the manufacture of the said goods is ordinarily carried on with the aid of power. The appellant claimed exemption in respect of fireworks manufactured by it on the basis of the said notification on the ground that no process in relation to the manufacture of the said goods was ordinarily carried on with the aid of power. On September 2, 1987 the excise authorities detained 6,222 wooden cases of fireworks valued at Rs. 39,83,698.50 and a sum of Rs. 5,97,555/- was demanded as excise duty payable on the said goods on the ground that the goods were not entitled to exemption from excise dut....
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....or of Central Excise by order dated December 18, 1990 confirmed the demand of duty of Rs. 5,97,555/- made in the show cause notice dated February 16, 1987 in view of the decision of this Court in Wallace Flour Mills Co. Ltd. v. Collector of Central Excise, Bombay, Division II - 1989 (44) E.L.T. 598 (S.C.) = 1989 (4) SCC 592, wherein it was decided that the rate of duty prevalent on the date of removal is only applicable. It was held that since the goods were removed after September 17, 1987 excise duty was payable on the same. The Assistant Collector did not go into the merits of the claim of the appellant that they were not using power for manufacture of fireworks. The said order of the Assistant Collector of Central Excise was affirmed in....
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.... the Tribunal on the view that it was not raised before the lower authority and it could not be urged at the appellate stage. 2.Shri S. Muralidhar, the learned counsel appearing for the appellant, has urged that the decision of the Calcutta High Court in Priyanka Overseas (P) Ltd. (supra) has been upheld by this Court in Priyanka Overseas Pvt. Ltd. & Anr. v. Union of India & Ors. - 1991 (51) E.L.T. 185 (S.C.) = 1991 Supp. (1) SCC 102. The appellant in that case had, on December 17, 1987, filed the bills of entry for home consumption as required under Section 68 of the Customs Act with a prayer for debonding the goods of 3935.364 MT which were stored in a private warehouse. The customs authorities, on that very day, i.e., December 17, 198....
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....g any duty as on January 28, 1988 no duty was payable on the goods." [p. 124] 3.The submission of Shri Muralidhar is that the principle laid down in the aforesaid decision of this Court in Priyanka Overseas Pvt. Ltd. & Anr. v. Union of India (supra) is applicable in the facts of this case because the goods had been wrongly and illegally detained by the customs authorities on September 2, 1987 and by the time the goods were released for clearance on the basis of the interim order passed by the High Court on September 29, 1987, the exemption from duty under Notification No. 167/86 had been withdrawn by Notification No. 222/87, dated December 17, 1987. He has urged that the appellant cannot be made to suffer on account of illegal act of the....
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....e the premises of the factory by outsiders and hence exemption under Notification No. 167/88, dated March 1, 1986 could not be available. In their reply to the said show cause notice the appellant stated that they had not used power in any of the processes in the manufacture of the fireworks in their factories or outside their premises and it was claimed that the chemicals used for such manufacture were hand-pounded. By order dated December 18, 1990, the Assistant Collector held that it is incredible and highly improbable that flour mills which are run by power should undertake hand-pounding and that the flour mills had undertaken the grinding of chemicals only by using power. It was also held that paper tubes, paper cones were also made by....