TaxTMI 
TaxTMI 
2005 (9) TMI 195
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....materials etc. are procured from Intra zone units and BOPP films and some labels are procured from indigenous suppliers. (ii) All the imported materials are tested and checked with the master samples maintained at the factory and their conformation to strict quality requirements is ensured. (iii) The bottles/godets/tubes/containers etc are filled in the factory and in case of bottles the fitment of pumps, actuators and collars, is carried out. (iv) Individual cartons and liners are folded and kept ready for packing of the required products. (v) The bottles are spray tested on the conveyor and then inserted in individual cartons which are subsequently labeled. (vi) After the various products are put in their respective individual cartons and the individual cartons are labeled, the activity of cellophaning of individual cartons is carried out. The BOPP films used for cellophaning are cut to specific sizes and cellophaning is carried out either manually or with the cellophaning machine.....
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....ottles/godets/tubes/containers etc. which have been placed in the individual cartons. However packing materials such as labels are imported separately. Other packing materials such as inner cartons, outer cartons, gum tape rolls, strapping materials, etc are procured from intra-zone units and BOPP films and some labels are procured from indigenous suppliers. (ii) The products are removed from their individual cartons and tested for their conformity with the master samples maintained at the factory. In case of bottles, the activity of spray testing on conveyors is carried out after dismantling the filled bottles. Detective products are rejected. (iii) The products are then inserted in their respective individual cartons which are subsequently labeled. (iv) After the various products are put in their individual cartons and the individual cartons are labeled, the activity of cellophaning of individual cartons is carried out. The BOPP films used for cellophaning are cut to specific sizes and cellophaning is carried out either manually or with the cellophaning machine. (v) &nbs....
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....e department in ascertaining the facts of the case. (viii) In terms of proviso (3) of the Notification No. 133/94-Cus. the consignments as per annexure cleared under DTA sale were not eligible for duty benefit of Notification No. 2/95-C.E and duty was chargeable at full rate of duty. Since these products contains Alcohol as its ingredients, the CVD is leviable @ 50% under the Medicinal and Toilet preparations (Excise duties) Act, 1955. (ix) On the consignments cleared during last six months the total duty leviable is Rs. 90,49,448/- (Rupees ninety lakhs forty-nine thousand four hundred and forty-eight only) as against Rs. 30,08,353/- (Rupees thirty lakhs zero eight thousand three hundred and filly-three only) paid by them. (x) They are also liable to pay the interest amount on this duty liability from the date of assessment. (Therefore, they were asked to show cause as to why - (i) the subject goods not be denied the benefit of notification 2/95-C.E., dated 4-1-95 in view of provision of para (3) of Notification No. 133/94-Cus., dated 22-6-94 and the go....
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.... (ii) Imposed a penalty of Rs. 60,41,095/- under Rule 173Q read with Section 11AC of the Central Excise Act, 1944 & inters was demanded under the provision of Customs Act, 1962. Hence the appeal. 2.1 After hearing both sides and considering the material it is found - (a) the ld. Commissioner, is coming to a conclusion that there was no manufacture taking place under the Central Excise Act, 1944 or the rules or chapter note/section note of Central Excise Tariff Act, 1985, therefore he confirmed & demanded the duty of Rs. 60,41,095/- made in the show cause notice under the provision of Section 11A of the Central Excise Act, 1944. This could be explained by the Commissioner finding arrived, of non-quoting of rules/sections not debasing the demand. However, the order of the Commissioner thereafter on the penalty liability, under Rule 173Q read with Section 11AC of the Central Excise Act, 1944 and keeping the same at Mandatory level of 100% provided under Section 11AC is not understood. It can only be due to a desire to some how confirm a demand and penalty. If no manufacture under Central Exc....
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....eld. (d) On merits, it is found that - (i) On examining the detailed processes undertaken, as recorded (supra), the same are to be treated as process amounting to manufacture in terms of Notification 133/94 when Boards Circular vide 314/30/97 vide para 5 thereof & paras of the Exim Policy are read to us. An approval granted on satisfaction by Development Commissioner by letter dated 12-10-95 is being shown & the law settled by Catena of decision of the Tribunal on the issue that concept of manufacture in such units are sought to be applied (ii) We find that all 'manufacture ' cannot be judged with reference to Section 2(f) of the Central Excise Act, 1944. Infact the board vide its orders/circulars has held and ordered the field staff, that a broader view is called for in respect of the interpretation of the provisions of Notification 1/95-C.E. & the exemption may not be restricted only to cases where 'manufacture' under Section 2(f) of Central Excise Act is involved" (see para 5 of Circular CBE&C Circular No. 314/30/97-C dated 6-5-97). This vi....