TMI Blog1998 (7) TMI 274X X X X Extracts X X X X X X X X Extracts X X X X ..... re it is processed to make various drinks marketed as Mangola . The remaining part is sold at the factory at Pune to outsiders. 2.1 Question involved herein is whether the appellants goods transferred by them to their factory at Chembur are to be classified under Tariff sub-heading 2001.90, as contended by the appellants or under sub-heading 2001.10, as contended by the Revenue. In order to understand the controversy at hand we reproduce the relevant sub-headings :- Heading No. Sub-heading No. Description of goods. Rate of duty (1) (2) (3) (4) 20.01 Preparations of vegetables, fruit, nuts or other parts of plants, including jams, fruit jellies, marmalade ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oresaid. In other words, the Commissioner (Appeals) order dated 30-10-1986 holding that it was a sale became final. As a result, the department on introduction of the new Tariff meanwhile w.e.f. 1-3-1986 had dropped its earlier decision because it had taken up the matter in appeal before the Tribunal. Later on, however, it issued show cause notice dated 13-10-1988 for the period 1-4-1988 to 5-10-1988 demanding duty on the said products treating them as sale under Tariff sub-heading 2001.10. It is this demand of duty which has been confirmed by the lower authorities which is in dispute before us. 3.1 Learned Advocate, Shri M.P. Devnath submits that the definition of Sale given in Section 2 (h) of the Central Excise Act, 1944 requires trans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e period 1986 to 1988 the department just kept quite and did not take any action. 3.4 Opposing the contention learned JDR, Shri A.M. Tilak submits that the correspondence relied upon by the learned Advocate was of the period when this issue was subjudice before the authority i.e. Commissioner (Appeals), Bombay when he passed the order on 30-10-1986 upholding the contention of the appellants herein that the transaction between the Pune and Chembur Units is one of sale. He further submits that keeping in view only the dispute persisting between the department and the appellants for a long time, the Revenue has asked for a demand of only for six months and not beyond the period of six months as permissible under Section 11-A. 3.5 On the ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be dutiable, therefore, the Chembur Unit will be entitled in the Modvat credit if it is shown to have complied that the inputs have been utilised in the final product and that the inputs had paid the duty. This plea was not taken before the lower authorities but nevertheless if the appellants satisfy the provisions of Modvat Rules, except the filing of the Modvat declaration, their plea should be considered by the authorities below and the benefit of Modvat credit should be extended if otherwise admissible to them. Question of confiscating the plant and machinery in the facts and circumstances of the case does not arise as the matter was subjudice before the higher authorities and the matter required resolution of disputed questions of law ..... X X X X Extracts X X X X X X X X Extracts X X X X
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