TMI Blog2010 (8) TMI 42X X X X Extracts X X X X X X X X Extracts X X X X ..... mar, DR, for the Appellant. Shri A.R.M. Rao, Advocate, for the Respondent. [Order per: Chittaranjan Satapathy, Member (T)]. - Appeal No. E/428 and 429/2006 have been filed by the Department respectively against M/s. Taneja Mines (P) Ltd., and Shri N.K. Taneja against Order-in-Original Nos. 22 23/2005 dated 28-4-2005 passed by the adjudicating Commissioner in pursuance of the review order dated 8-12-2005 passed by the Committee of Chief Commissioners. E/CO/97/2006 has been filed by the respondents in respect of these two appeals filed by the Department. 2. Appeal No. E/2488/2005 and E/2489/2005 have been filed respectively by M/s. Taneja Mines (P) Ltd. and Shri N.K. Taneja against the very same impugned Order-in-Original Nos. 22 23/2005 dated 28-4-2005. As such, all these four appeals and the cross-objection relate to the same impugned order passed by the adjudicating Commissioner. 3. We have heard both sides. 4. Shri Sumit Kumar, learned DR appearing for the department states that the department has come in appeal against the impugned order under which the Adjudicating Commissioner has held part of the goods to be not manufactured goods and has held part of the g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pugned goods which were excisable, the office and factory premises of TML were searched by the officers of Anti-Evasion of the Central Excise Commissionerate, Delhi-I on 10-10-2003. Entire proceedings of the search were re corded in the Panchnama dated 10-10-2003 drawn on the spot. (iii) The above referred Pancbnama dated 10-10-2003 drawn on the spot in the presence of two independent witnesses and Shri N.K. Taneja, MD of the company, revealed that a few machines viz, lamination machines (4 Nos.) hand press machines (4 Nos.), battery operated screw driver, price gun (2 Nos.) and shrink wrap machines (2 Nos.) were found installed in the said manufacturing premises and 39 workers were found engaged in the said premises for the manufacturing activities. Shri N.K. Taneja, MD of the unit and Shri Nthar Ranjan Das, Manager (Distribution and Quality Control) inter alia confirmed the activities carried on by their company in their respective statements recorded under Section 14 of the Central Excise Act, 1944. (iv) Statement of Shri Nihar Ranjan Das was recorded on 10-10-2003. He inter alia stated that he was working as Manager (Distribution and Quality Control); that the company was a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng in the above premises and their respective utility in the different processes required for making their product marketable. He further stated that they were getting packing material and corrugated boxes carrying the logos of Diviniti as per the requirement, that they mar keted their product through distributors and also directly from their office. (vi) Statement of Shri Sandeep Chadha of M/s. Matcos, one of the distributors of TML was recorded on 14-1-2004. He inter alia stated that they were a distributor of 'Diviniti products' of the party for the past 5 years; thatthey had no written agreement with the party; that Diviniti products were mainly gift items having decorative and or namental value; that these were visuals of God having little or no utility value; that they purchased Diviniti products from the party and sold them to their customers, which included mainly gift shops and car accessory shops. (vii) In response to the summons issued to Shri N.K. Taneja, Managing Director of TML, Shri Vipin Aggarwal, Sr. Finance Manager, duly authorized by Shri N.K. Taneja appeared on his/company's behalf and his statement was recorded on 22-1-2004. He stated that he was working a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re wrapped in polyurethane packings and were further packed in card board, printed gift packs containing the brand name DIVINITI; that thereon size, specification and other details of the pictures and RSP stickers were affixed with the sticker guns. Thereafter, the said printed gifts packs were further packed in individual corrugated packing and then further bulk packed in corrugated/wooden boxes. (b) Pen stands jewellery boxes :- The moulded acrylic articles and various other parts were procured locally and the imported gold plated base metal portions were affixed on them with screws and adhesives. (c) Clocks :- The moulded shells and the clocks were being pro cured locally. The imported gold plated pieces (dials) were affixed on the faces of the clocks and were packed in the manner discussed above. 7. It has been argued on behalf of the Department that the impugned goods manufactured by TML are to be held to be excisable and charged to duty. The majority of the products namely pictures, certificates, mementoes etc. made from imported gold plated nickel foil and appropriately framed with the help of various indigenously procured materials, machines installed in the premi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tment on the goods to render (hem marketable is deemed to be manufacture. Since the party admittedly packs and labels the watches/clocks with their brand name, retail sale price etc. even if it does not itself embellish them with images of deities etc., such activities amount to deemed manufacture. The party. itself has, though without directly ad miffing deemed manufacture of such clocks, acknowledged that these figure in the Third Schedule to the Central Excise Tariff Act, 1985. "I, therefore, hold that the activity undertaken by the party in relation to desk top clocks amounts to manufacture within the meaning of Section 2(f)(iii) CEA." With the above finding, he has confirmed the duty demand of Rs. 1,23,774/- and has imposed appropriate penalties and has also ordered for payment of interest giving option to TML to pay 25% of the penalty as required under Section 11AC of the Central Excise Act, 1944. We find no reason to interfere with his order in regard to the desk top clocks as the same is in accordance with law. 10. As regards other articles such as pen holders, pen stands, visiting card holders, jewellery boxes etc., the adjudicating Commissioner has come to the conc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g process under the Excise Law is sound and the same does not require any interference. The impugned goods, popularly known as 'Diviniti Products' have a separate identity and are known as such in the market. They meet the twin criteria of manufacture and marketability laid down by various judgments of the; Hon'ble Supreme Court to bring a product within the ambit of excisable goods. The end-product in this case which is sold through the shops has a distinct use and is different from the input material which cannot be put to use without undergoing the process involved. 12. However, we are not in agreement with the finding given by the adjudicating Commissioner in regard to the classification of the impugned goods. TML has claimed, and the adjudicating Commissioner has classified, the impugned 'Diviniti products' under Heading 4901.90 chargeable to nil rate of duty. The Department's claim is that the impugned goods require classification under Heading 8306.00. We reproduce below the two competing entries :- (i) Heading No. Sub- heading No. Description of goods Rate of Duty (1) (2) (3) (4) 49 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s frames of base metal. As seen from the Explanatory Notes to the HSN for Heading 8306, the goods meriting classification under Heading 8306 include a wide range of articles of base metal of a kind designed essentially for decoration in homes, offices, assembly rooms, places of religious workshop etc. unless such articles are covered by more specific headings of the Nomenclature (we note in this regard that Heading 4901.90 is not a more specific heading by any stretch of imagination). The Heading 8306 also includes articles which may not have any utility value but which are wholly ornamental including articles for religious use. The Explanatory Notes for Heading 8306 also state that photograph, picture, mirror etc. and frames of base metal of all shapes and dimensions are included in this Heading and further that they remain in this Heading even if fitted with supports or with backings of paperboard, wood or other material. The Heading includes items even fitted with plain glass. The only exclusion being glass mirror with metal frames which fall under Heading 70.09. As such, we have no doubt in our minds that between the two competing entries in the Tariff, namely 4901.90 and 8306. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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