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2019 (5) TMI 1168 - AT - Central ExciseProcess amounting to manufacture or not - activities of cutting and corrugation of GP Coils/Sheets received from various parties - case of Department with regard to corrugation of sheets, is that, it was held that such activity undertaken by the respondent amounts to manufacture, as a new entity emerges after such activity, which is distinct in name, use and character - extended period of limitation. The impugned order has dropped the proposed duty demands for the said goods manufactured during February’ 2012, holding that proposal for recovery was made beyond the normal period of one year and thus, the show cause proceedings initiated were barred by limitation of time. HELD THAT:- The issue, as to whether, the activity of corrugation amounts to manufacture or not was highly contentious and there were divergent views by different judicial forums and finally the issue gets settled by the Hon’ble Punjab & Haryana High Court, in the case of Hansa Metallics Ltd. Vs. Union of India, [ 2001 (2) TMI 138 - HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH ], holding that process of corrugation of plain metallic sheets and galvanized sheets undertaken by the petitioner amounts to manufacture, as a new commercial product having different identity and use come into existence. Even after pronouncement of the said judgment by the Hon’ble Punjab & Haryana High Court, the Hon’ble Supreme Court, in the case of Vardhman Industries Ltd. Vs. CCE, Chandigarh, [ 2008 (3) TMI 51 - SUPREME COURT ], while remanding the matter for re-adjudication, have directed the original authority for passing of denovo order uninfluenced by the judgment of the said High Court passed in the case of Hansa Metallics Ltd., keeping the question of law open as to whether, corrugation amounts to manufacture or not. Thus, we accept the submissions of the respondent that non-payment of the duty amount was due to the bona fide belief that the activity will not amount to manufacture. The law is well settled by the Hon’ble Apex Court, in the case of Chamundi Die Cast Vs. CCE, Banglore [ 2007 (5) TMI 55 - SUPREME COURT ], Gopal Zarda Udyog Vs. CCE, New Delhi [ 2005 (9) TMI 83 - SUPREME COURT ], Ugam Chand Bhandari Vs. CCE, Madras [ 2004 (5) TMI 73 - SUPREME COURT ] that when the assessee acted under bonafide belief on a particular aspect and there were difference of opinion in the department on such aspect, the extended period of limitation cannot be invoked especially, when the activities of the assessee were in the knowledge of the department officers, who regularly visit its factory. The extended period of limitation cannot be invoked - appeal dismissed - decided against Revenue.
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