TMI Blog1999 (2) TMI 204X X X X Extracts X X X X X X X X Extracts X X X X ..... factory at Kurla where they were subjected to the processes of annealing and pickling. The annealed and pickled wire rods were thereafter exported. By a declaration dated 25-9-1992 received in the office of the jurisdictional Assistant Collector on the same day, the assessee s its factory at Kurla, intimated its intention to avail of the Modvat credit on the duty paid on the unannealed and unpickled wire rods. Since the final product did not pay duty having been exported, under the claim of rebate which was granted, the credit so taken was utilised towards payment of duty on similar products cleared for home consumption. The assessee continued to take credit in this manner. 3. By notice dated 1-10-1997, the Commissioner proposed to recove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any intention to evade duty. Liability to penalty of the assessee and the employees was also questioned. 5. The Commissioner did not accept these contentions. He relied upon the Supreme Court s judgment in Union of India v. DCM Ltd. 1977 (1) E.L.T. (J 199) to say that the processes in question did not amount to manufacture. The description by the assessee of the processes as manufacture, in its declaration under Rule 57G, therefore amounted to mis-statement. He confirmed the demand for duty. He also imposed penalties on the assessee as well as on each of them. Hence these appeals. 6. We are unable to accept entirely the contention of the advocate for the appellant that the processes of annealing and pickling amount to manufacture. The t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d three months after the expiry of the period for which the duty is demanded. The declaration filed under Rule 57G clearly indicated the final product to be stainless steel wire rods annealed and pickled in coil form. Input was described as stainless steel wire rods/coils. The remarks column in the declaration contains the following sentence : S.S. coils are heated to required temperature quenched into water bath and dip into acid for descaling to manufacture the S.S. wire rods duly pickled and annealed for export/local market. A reading of this declaration could not lead to any other conclusion but that the assessee received in its factory wire rods not annealed or pickled, and subjected them to these processes for the purposes of ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be shown to have taken credit on account of wilful mis-statement, collusion or suppression of facts. Each of these act requires a conscious and deliberate act or withholding of information. Unless there is such conscious or deliberate mis-statement of collusion or suppression of facts, the extended period contained in the proviso will not be available. It is well to remind ourselves of the observations of the Supreme Court in CCE v. HMM Ltd. - 1994 (76) E.L.T. 497 (S.C.) : Therefore, in order to attract the proviso to Section 11A(1) it must be alleged in the show cause notice that the duty of excise had not been levied or paid by reason of fraud, collusion or wilful mis-statement or suppression of fact on the part of the assessee or by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this context that the judgment cited by the Advocate for the appellant in Brakes India Ltd. v. Superintendent of Central Excise - 1998 (101) E.L.T. 241 assumes significance. The Court has approved the view of the single Judge of the Madras High Court, quoted in para 15 of this was of which we reproduce the following : When adopting a particular process, if a transformation takes place, which makes the product have a character and use of its own, which it did not bear earlier then the process would amount to manufacture within the meaning of Section 2(f) irrespective of the fact whether there has been a single process or have been several processes. It was therefore possible for the assessee to legitimately hold the view that two proce ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
