TMI Blog2002 (11) TMI 384X X X X Extracts X X X X X X X X Extracts X X X X ..... hand cart tyres, both falling under CSH 4011.10, were chargeable to nil rate of duty. The appellants manufactured bead wire rings (in short, BWRs) and used the same captively in the manufacture of the tyres. In the SCN, the department held the BWRs to be classifiable under CSH 7308.90 and alleged, inter alia, that duty of excise was chargeable on those BWRs which had been captively used in the manufacture of the fully exempted products viz. ADV tyres and hand cart tyres during the aforesaid period. The SCN invoked the extended period of limitation to demand such duty, alleging that the noticee had suppressed the factum of manufacture and removal of the BWRs, before the department. The noticee denied all the allegations and pointed out, in their reply to SCN, that the question whether to grant exemption from duty in respect of BWRs to be used in ADV/Hand Cart tyres was under the CBEC s consideration. The party hoped that a notification in this behalf would be shortly issued by the Board under Section 11(c). The Collector who adjudicated the matter demanded duty of Rs. 3,30,353.25 on the BWRs used in the exempted ADV/Hand Cart tyres, apart from duty of Rs. 7454.40 on the rings used ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ength of the reasonings stated therein. 5. We have examined the submissions. In Para (12) of the impugned order, the Commissioner has noted that there is no dispute with regard to two aspects viz. (a) manufacture and clearance, for captive consumption, of the impugned goods; (b) classification of the goods and the effective rate of duty applicable. The only issue before him was, broadly, whether duty of excise was liable to be paid on the BWRs manufactured and removed for captive use in the manufacture of ADV tyres during the material period. For this issue to be decided upon, it had to be determined as to whether the item was marketable (in order to be held to be excisable) and, if so, whether the demand of duty thereon was time-barred. The remand of the case by this Tribunal to the adjudicating authority was for this purpose. 6.1. We shall examine whether, as claimed by the counsel, the main question of marketability of the subject item is covered in the assessee s favour by the decision in the MRF case (supra). In that case also the item considered by this Tribunal was BWRs which were steel wires in circular shape coated with rubber compound by mechanical operation and wrap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d determining its excisability accordingly. But nothing has been placed on record before us to show that the orders-in-appeal passed by the Appellate Collectors in the cases of M/s. Dunlop (India) Ltd. and M/s. Goodyear (India) Ltd. were also set aside by the Tribunal or any competent Court. Moreover, what is contained in the above extract from the order in MRF case is not the only ground, in that case, for holding the BWR to be non-marketable. We therefore do not subscribe to the DR s view that the decision in that case is per incuriam. As we have already noted, the BWRs before the Tribunal in the cited case of MRF were steel wires in circular shape coated with rubber compound by mechanical operation . We find that the product under consideration in the instant case is also BWR in circular shape coated with rubber compound by mechanical operation. This is clear from the un-disputed process of manufacture stated in the memorandum of appeal, extracted below :- Bead wire, which is a high tensile steel wire suitably treated (e.g. copper coated) so as to ensure adhesion to rubber, is received in large spools. A number of such spools are mounted on free rolling stands. A particula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere to be used preferably within 8 to 10 hours. Ld. Commissioner, harping on the word preferably , held that the shelf life of the impugned goods could not be restricted to any specified time period of short duration. In our view, this inference of the adjudicating authority is not flawless inasmuch as the deposition of Kulkarni could judiciously be interpreted to mean that the BWR must be used, at any rate, within 10 hours from the time of its manufacture. In our view, this period is too short for the manufacturer to take out the item to the market and for any instant buyer to take it to his factory and use it in the manufacture of tyre. We think that the decision of the Apex Court in Moti Laminates Pvt. Ltd. v. CCE [1995 (76) E.L.T. 241 (S.C.)] wherein an intermediate product of the assessee, which was captively used in the manufacture of final product, was held to be non-marketable on the ground that it had a shelf life not exceeding 15 days even in controlled conditions, is apposite to this context. 6.4. Yet another view taken by the Commissioner is that that appellants BWRs for ADV tyres were to be held excisable like similar goods (i.e., BWR for ADV tyre) of M/s. Hindusta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o pieces of evidence gathered by the department have not been considered by the Commissioner. One of them is a statement of Shri Om Parkash Pahwa, Partner of M/s. Ram Lubhaya Co., who stated that they were manufacturing BWRs on job work basis for M/s. Ralson (I) Ltd., Ludhiana. We have perused this statement. The process of manufacture of BWRs stated by Shri Om Parkash Pahwa, is as under :- 1. Steel wire is cut according to specific size required for the rings. 2. The cut wire put on the frame to get required shape of rings and thereafter it joined by galvanised iron wires. 3. Such rings are thereafter inspected. The above process shows that the product of M/s. Ram Lubhaya Co. was not rubberised bead wire rings and was different from the appellant s product. Hence the statement of Om Parkash Pahwa is not of any aid to the Revenue s case. The department had also relied on a classification declaration dated 19-7-99 of M/s. Govind Rubber Ltd., a copy of which is also available on record and which we have perused. The goods declared by M/s. Govind Rubber Ltd. was tyre bead wire rings for use in the manufacture of tyre for cycles and cycle rickshaws . That ..... X X X X Extracts X X X X X X X X Extracts X X X X
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