TaxTMI 
TaxTMI 
2025 (9) TMI 60
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....016. By Final Order No. 50784 of 2018 dated 21.2.2018, this Tribunal had remanded the matter keeping all issues open. The relevant portion of the Final Order is as follows: ".... 3. With this background, we have heard Shri H. Saini, learned DR for the Department and Shri R.K. Hasija, learned counsel for the assessee-Respondents. 4. The learned DR submits that under Notification No. 1/2011-CE dated 01.03.2011 at Sl. No. 97 'Sewing machines other than those with inbuilt motors' was given under the concessional rate of duty @1% being under sub-heading 8452. He also submits that the adjudicating authority has relied upon the ratio of the Gabbar Engineering Co. versus CCE, Ahmedabad, 2009 (244) ELT 552 (T-Ahmd.), which was distinguished in the grounds of appeal. So, he submits that it has inbuilt motors and concessional rate of duty is not applicable. 5. On the other hand, the learned counsel for the assessee-Respondents supported the impugned order. He has drawn our attention to the annexures of reports obtained by them. One of the reports is from Northern India Textile Research Association dated 03.09.2014 wherein it was clearly stated that the said....
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.... 6/2006-CE and 1/2011-CE 5. The undisputed legal position is that the benefit of both these notifications was available to 'Sewing machines other than those with inbuilt motors'. Notification No. 6/2006-CE dated 1.3.2006 (S. No. 15) which corresponds to the disputed period 1.4.2009 to 28.2.2011 provided for Nil rate of duty. Notification No. 1/2011-CE dated 1.3.2011 (S. No. 97) provided for a concessional rate of duty of 1% (which corresponds to the disputed period 1.3.2011 to 16.3.2012) and 2% (which corresponds to the disputed period 17.3.2012 to 10.7.2014). 6. The undisputed factual position is that the appellant had manufactured and cleared sewing machines meant for stitching bags and that each of these machines had a motor and they were not meant for manual stitching. The sewing machines when they were cleared from the factory had the motors in them. The motor was part of the sewing machine and was not an optional accessory. The motor was connected to the sewing mechanism through a belt and the motor, the belt and the sewing mechanism all have proper housing and are covered. 7. According to the Revenue and as held in the impugned order, the sewing machines, being with....
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....arious machines to perform various functions. The power of the prime mover has to be transmitted to the rest of the machine. This transmission can take place by directly connecting the machine to the prime mover with a shaft or through a belt and pulley or through gears or through levers. 11. The notification does not stipulate any particular mechanism of transmission of power from the motor to the sewing mechanism. So long as there is an in-built motor in the sewing machine, it is not eligible for exemption and if there is no in-built motor, it is eligible for exemption. There is no definition of the expression 'in-built' in the notification. The correct way of interpreting it is, therefore, as someone in the market would understand. If one goes to the market to buy a sewing machine, one would like to know if it has an in-built motor or not. If the machine has no in-built motor, it may have to be operated through human effort or a separate motor would have to be bought and fitted to it. Each sewing machine of the appellant had a motor within it and the motor, the sewing machine as well as the belt and pulley were all cased in a housing within the sewing machine. Anyone buying t....
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....t motors and thereafter, motors were added separately and this activity was held to be not manufacture because no new article had come into existence. 18. The case in this appeal is completely different as the motor, V belt as well as the rest of the sewing machine were all encased in a housing and were all part and parcel of the sewing machine. Therefore, Gabbar Industries would squarely apply to this case. 19. We, therefore, find that the appellant is not entitled to the benefit of the exemption notifications. Suspension unit with hook 20. The sewing machines manufactured by the appellant were meant to stitch up bags. These are used in industries to stitch up the bags after filling them. One convenient way of stitching the mouth of the bags after filling them is to hang the sewing machine with a hook. The suspension unit helps in hanging the sewing machine. It is sold by the appellant as an optional accessory. It is not sold as part of the sewing machine. 21. The submission of the appellant is that since the suspension unit is meant to be used with the sewing machine, it should be classified as part of the sewing machine and accordingly should be treated as exempte....
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....y assessing duty as per its understanding. The appellant had not failed in its duties. If the non-payment of duty was not detected within time, it is because, the range officer with whom the returns were filed failed in his duty to scrutinise the returns and raise a demand within time and not because the appellant had failed in its duties. The appellant's responsibility is to self-assess duty as per its understanding and it has no obligation to anticipate if DGCEI would one day look into its records and if so, what view DGCEI would take and file returns accordingly. The appellant's view was that it was eligible to the exemption and accordingly assessed the duty. It was for the range officer to have scrutinised the returns. 28. At this stage, learned authorised representative vehemently argued that the range officer was not at fault because as per the instructions issued by the Central Board of Excise and Customs, only preliminary scrutiny of the returns was to be done and the officer was explicitly prohibited by the instructions of the Board from looking into further details. He further submits that the Board had issued instructions to officers as to in which cases only prelimin....