TMI Blog2001 (4) TMI 497X X X X Extracts X X X X X X X X Extracts X X X X ..... sues involved I find that the impugned order does not suffer from any legal infirmity and merits to be sustained. Accordingly, I uphold the same . Being aggrieved by this order, the appellants have filed the captioned appeal. 2. The facts of the case briefly stated are that the appellants are engaged in the manufacture of woollen hosiery goods. The appellant receives woollen yarn in plain (straight) reel hanks form. Yarn in the form of hanks cannot be used in the manufacture of hosiery goods, therefore, the yarn in hanks is converted into cones. The Department alleged that the process of conversion of any one or more product into another form amounts to manufacture in terms of Chapter Note 3 of Chapter 51 w.e.f. 26-5-1995. It was alleged that since the yarn purchased by the appellant was in plain straight reel hanks and was converted into cones yarn, therefore, this change in form of the yarn amounted to manufacture and the appellants were directed to pay duty on the yarn in the form of cones. The authorities below decided the issue against the assessee, Shri K.K. Anand, ld. Counsel appears for the appellant whereas Shri S. Narayan Singh, ld. DR appears for the Revenue. It was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts for a long life. The woollen hosiery products were exempted, they were neither submitting any declaration nor any classification list. He submits that no intimation was required to be sent. Ld. Counsel also submitted that a number of units were issued Show Cause Notices in 1994 alleging that the units were required to pay duty as yarn fully manufactured at off the spindle stage. Ld. Counsel submits that the issue was examined by the Ld. Commissioner and by his order dated 17-8-1995 he dropped the proceedings against all the parties holding that the issue of accountal of the woollen yarn in the RG-I at off the spindle stage and consequent charging of duty came up for discussion in the IVth conference of the Collectors of Central Excise, it was held that the question of charging duty on yarn at single yarn stage would not be arised as the issue of single yarn or its conversion into hanks within the factory would not amount to removal in terms of Rule 9 of the Central Excise Rules. Ld. Counsel, therefore, submitted that the appellants had the bona fide belief that no duty was chargeable in the process of change in form of the yarn from hanks into cones. He submitted that the Apex C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xcises Salt Act, 1944 for extended period of limitation. He submits that there was no intention to evade payment of duty, therefore, the extended period was not invokable in their case. Ld. Counsel also referred to the latest decision of this Tribunal in the case of Raj Rayon Ltd. v. C.C.E. reported in 2001 (127) E.L.T. 261 in which this Tribunal held that doubt existing prior to amendment of Note 3 to Chapter 54 of Central Excise Tariff Act, 1985 in 1999 as to whether inter-mingling of yarns amounted to manufacture; that suppression or mis-statement by assessee was not established and therefore, extended period of limitation was not invokable. He submitted that in their case, there was no suppression, mis-statement etc. to evade payment of duty and therefore, extended period of limitation cannot be invoked. It was also submitted by the ld. Counsel that this Tribunal in the case of Bihar Foundry Engg. Works v. C.C.E., Patna reported in 1999 (107) E.L.T. 779 held that the appellant under a bona fide belief is not taking out a Central Excise Licence in view of a long standing practice of classification of such goods as castings under Tariff Item 25 of erstwhile Central Excise T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that they were not aware of the excisability of the laminations. They have described the goods as protective device to the rotor and stator component of the dynamo. If the appellant had any doubt in the matter, they should have ascertained the position from the concerned authorities. Having regard to these circumstances, the demand can be made for the extended period of limitation. Ld. DR also referred to the judgment of this Tribunal in the case of Central India Machinery reported in 1989 (39) E.L.T. 306 in which the Tribunal held that non-levy arising due to suppression of fact, extended period of five years is applicable and not a period of six months. Ld. DR also refers to the judgment of this Tribunal in the case of Paxma Axle Springs P. Ltd. v. C.C.E reported in 1990 (47) E.L.T. 639 in which it was held that mere letter addressing the Department not sufficient when no response was received from the Department, extended period for five years was applicable. It was also contended by the Ld. DR that the Apex Court in the case of Novopan India Ltd. v. C.C.E. reported in 1994 (73) E.L.T. 769 held that in case of doubt or ambiguity, benefit of it must go to the state. He submits ..... X X X X Extracts X X X X X X X X Extracts X X X X
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