TMI Blog2014 (4) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... ce under proper challans, need further examination. According to the Applicant, the fact they were eligible to credit, is also not discussed by the ld. Commissioner. Regarding demand raised on shortage of bearings (in Annexure-C-4), the ld. Commissioner has not considered the fact that rejection is bound to take place during manufacture and the evidences adduced by the Applicant/Appellant before him, were discarded. The Applicant/Appellant has categorically stated that even the stock-taking report refers to rejection of the bearings and therefore, such rejection reflected in their books of accounts, should be considered before arriving at their shortage. In case of duty demanded (in Annexure-C-5) on spares shown to be removed under private ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the Applicants has submitted that this Tribunal, vide Stay Order No.S-339-341/KOL/2011 dated 17.11.2011, dismissed the Applications of the above-mentioned Applicants for waiver of predeposit of duty, interest and penalties adjudged, vide De Novo Order dated 31.03.2009 of the Adjudicating Commissioner for non-prosecution. Subsequently, vide Tribunal s Final Order No.A-85-87/KOL/2012 dated 14.02.2012, all the Appeals were dismissed for non-compliance with the Predeposit Order. The Applicant firm, M/s. Polar Industries filed a Miscellaneous Application before the Tribunal to recall/modify the above Tribunal s Orders. Miscellaneous Application was dismissed by this Tribunal s Order No.M-598/KOL/2012 dated 25.10.2012. Being aggrieved, the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal during first round of litigation. In view of these facts, we waive the requirement of predeposit and take up their Appeals for disposal at this stage itself. 4.1. Narrating the facts of the case, the ld. Advocate for the Appellants submitted that a major amount of demand i.e.Rs.33,04,982/- [shown in Annexure-C(1)] relates to the fans cleared after their repair/re-conditioning under Rule 16 of the Central Excise Rules. However, the Department has alleged that no repairing activity took place, but fresh fans were manufactured and removed in the guise of repaired fans. 4.2. Demand of Rs.2,299.81 (i.e.Rs.2300/-) [as per Annexure-C(3)] is attributable to shortage of finished goods found on physical verification and when compared to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch credit according to the said Rules. If the process does not amount to manufacture, the manufacturer shall pay an amount equal to the credit taken under sub-rule(1) of Rule 16. Rule 16(3) provided that for any difficulty in implementing the above provisions, the Commissioner may specify any conditions to be followed. It is stated that even though the Department was fully aware of the practice followed, it never prescribed any condition. The ld. Advocate cited various judgments holding that activity of repair does not amount to manufacture. He submitted that even if it is held that returned goods were subjected to manufacture in the Applicant s factory, the Applicant firm was eligible for credit of Rs.27,74,868/- paid as duty on the said f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Show Cause Notice, that rejection invariably occurs during manufacture. 5.3. As regards the demand (in Annexure-C-5), on removal of the spares (without payment of duty) under private challans, the ld. Advocate submitted that these challans do not represent the actual removal of the spares, but they were prepared only for the financial adjustment of the short receipt while receiving defective fans etc. He explained that this plea has not been accepted by the Adjudicating Authority. 6. Per contra, ld. AR for the Revenue reiterated the findings of the ld. Adjudicating Commissioner. 7. We find that the issue involved in the present case is whether the fans which were purportedly cleared by the Applicant Firm as a repaired/re-conditi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dismantling of the defective fans took place under proper challans, need further examination. According to the Applicant, the fact they were eligible to credit, is also not discussed by the ld. Commissioner. Regarding demand raised on shortage of bearings (in Annexure-C-4), the ld. Commissioner has not considered the fact that rejection is bound to take place during manufacture and the evidences adduced by the Applicant/Appellant before him, were discarded. The Applicant/Appellant has categorically stated that even the stock-taking report refers to rejection of the bearings and therefore, such rejection reflected in their books of accounts, should be considered before arriving at their shortage. In case of duty demanded (in Annexure-C-5) o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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