TMI Blog2007 (5) TMI 446X X X X Extracts X X X X X X X X Extracts X X X X ..... is regarding an identical issue and other two appeals filed by the employee of the company against the imposition of penalties on individuals, all the four appeals are disposed off by a common order. 2. The relevant facts that arise for consideration are that the appellant company are manufactures of products of precious metal of platinum, palladium and rhodium. The appellants removed the goods on payment of excise duty and also claim exemption for the products falling under Chapter 71. It was noticed, that during the refining of precious metal out of spent products of such precious metal, the appellant manufactured certain compounds of precious metal at the intermediate stage and consumed the same in the manufacture of precious metals and various products and these intermediate compounds are liable to payment of Central Excise duty in view of the fact that they were captively consumed for the manufacture of exempted goods. The Revenue officers recorded various statements of the persons and on conclusion of investigation issued a show cause notice directing the appellants to show cause as to why duty should not be demanded from them on the ground that the compounds of the precio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... finished articles. Their reliance on the varied judicial pronouncements, to say the least, is quite out of context. All of the commodities on which judgments have been pronounced were either waste and scrap or similar goods which cannot have any similarity whatsoever. If the ratio in the issue of Calcium Carbide as pronounced in the DCM case was made applicable I am afraid that most of the feeder industries would be out of the excise net. What need to be considered here are only those of comparable goods for the purpose of reliance. The goods under consideration are a much specialized one which is in fact marketed world wide in the similarly placed industries as per the requirements of buyers. In all other case, where M/s. HPL relied upon, pertain to various kinds of waste and scrap which are not the case in hand. The adjudicating authority also brushed aside the ground of limitation stating that the appellants had not given the declaration that intermediate products emerged in the factory and hence bar of limitation does not apply in this case. On such findings, the adjudicating authority confirmed the demands and imposed penalties, hence these appeals. 3. The ld. Advocate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the products is proved. He relies upon the print out of the products offered for sale by the appellants on their Website for this preposition. It is his submission that the appellants themselves have indicated that these products are marketable in their own Website. He further submits that the appellants had never indicated to the authorities that an intermediate product emerges and that it is a stable product. It is his submission that if an intermediate product which is stable, arises during the course of manufacture they would be dutiable if consumed for the manufacture of products which are exempt. He relies upon decision of the Hon ble Supreme Court in the case of Commissioner of Central Excise, Jaipur v. Hindustan Zinc Ltd. [2004 (166) E.L.T. 145] for this proposition. 5. Considered the submissions made at length by both sides and perused the records. It can be seen from the above-reproduced portion of the order-in-original (in Paragraph 2) that adjudicating authority has come to the conclusion that the products of the appellants are marketable if they are complete and identifiable. It is undisputed that the Revenue is trying to tax the intermediate products which arise d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee s products are stored in tins or cans for a short period would not ipso facto lead to the conclusion that the products were stable - Order passed only on the basis that these goods can conceivably be sold cannot be sustained - Burden to prove marketability of intermediate product not discharged by department - Demand not sustainable - Sections 2(d) and 3 of Central Excise Act, 1944 . 7. Three judges Bench, of the Hon ble Supreme Court in the case of Hindustan Zinc Ltd. as reported at [2005 (181) E.L.T. 170 (S.C.)] held as under :- Thus, marketability is essentially a question of fact. In the show cause notice it is stated as follows : As per market enquiry conducted revealed that silver chloride (75%) was being sold ex-factory @ Rs. 1000/- per 100 Gms. i.e. Rs. 10,000/- per Kg. The silver chloride manufactured by M/s. Hindustan Zinc Ltd. Debari containing 53.7% silver its assessable value of the comparable goods under the provisions of Rule 6(b)(i) of Central Excise (Valuation) Rules, 1975 works out to be Rs. 7160/- per Kg. . This seems to suggest that some market enquiry was made. However, it could not be sown to us what that market enquiry was. The above s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that Tariff Entry 14AA(1) was attracted, whatever might be the further process that the calcium carbide manufactured by the respondent might have to undergo by way of purification or packaging for that would not be tantamount to further manufacture. We are unable to agree for the simple reason that the commodity which is sought to be made liable to excise duty must be a commodity that is marketable as it is and not a commodity that may by further processing be made marketable. 9. The Hon ble Supreme Court in the case of Hindustan Ferodo Ltd. (supra) has set aside the order of the Tribunal on an identical issue by observing as under :- The Tribunal referred, in the order under appeal, to process drawings and came to the conclusion that the duty was sought to be levied at the fourth stage of manufacture in the appellants factory. The samples of the said rings, which were shown to the Tribunal, arose after this stage. They were in a finished form. There was nothing elementary or crude about them. As asbestos products, there were fully manufactured. Nothing further was required to be done to make them fully manufactured asbestos products. The appellants contention tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the brittleness of the said rings, it was for the Revenue to demonstrate that the appellants averment in this behalf was incorrect and not for the Tribunal to assess their brittleness for itself. Articles in question in an appeal are shown to the Tribunal to enable the Tribunal to comprehend what it is that it is dealing with. It is not an invitation to the Tribunal to give its opinion thereon, brushing aside the evidence before it. The technical knowledge of members of the Tribunal makes for better appreciation of the record, but not its substitution. The Revenue sought to make the said rings dutiable as asbestos articles. The affidavit evidence of a dealer in asbestos was of some relevance. So was the affidavit evidence that explained the character and use of the said rings. It was wrong of the Tribunal to find that the deponents of these affidavits were not the right persons to give opinion on the type of the products with which it was concerned. Regretably, the Tribunal s order under appeal shows that it was not fully conscious of the dispassionate judicial function it was expected to perform, and it must be quashed. 10. It can be seen from the ratio of the decisions ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
