TMI Blog2009 (2) TMI 574X X X X Extracts X X X X X X X X Extracts X X X X ..... final products to be manufactured by the appellant. Such denaturing of ENA is a statutory requirement in terms of Notification issued under the Medicinal and Toilet Preparations Act and the same are carried out under the physical supervision of the Daman State Excise authorities. 2. The officers of DGCEI visited the appellants factory on 29-8-2001 and after detailed verification of process involved in the manufacture of various cosmetic products, entertained a view that the addition of DEP in ENA results in emergence of an intermediate product i.e. Di ethyl Alcohol, which is a specified product leviable to Central Excise duty under chapter sub-heading 2204.10 of Central Excise Tariff Act. As such the officers entertained a view that such DEA is required to discharge the duty burden. During the course of further investigation statements of various persons were recorded. 3. On the above basis proceedings were initiated against the appellant by way of issuing show cause notice. The said proceedings culminated into order passed by the Commissioner on 30-4-2003 confirming demand to the tune of Rs. 19,23,896/- and imposing penalty of identical amount. In addition, Modvat credit to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... behalf of the assessee pleaded that in the factory of the assessee same sort of situation (as noticed in the case of M/s. Charishma Cosmetics Pvt. Ltd. and J.K. Helen Curtis Ltd.) occurs. We are surprised at the above observation of the Commissioner and really fail to understand as to how a matter can be remanded to the adjudicating authority for de novo consideration, without quashing or setting aside the order impugned before the appellate authority. The above observations are clearly against the basic jurisprudence of law especially when the Commissioner proceeds on the basis of the same and further holds in the impugned order that considering his findings contained in the earlier order is applicable here and having regards to my further findings........... I pass the following order . The appellant s grievance that no reference to the earlier order could have been made by the adjudicating authority when the same was set aside by the Tribunal, are well founded. 6. The appellants have further challenged the impugned order on merits as also on limitation. As is seen from the above the matter was remanded by the Tribunal for appreciating the appellant s stand that denatured ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for a small period, does not alter its chemical composition or render it to be a different product. The said ENA remains ENA only. The addition of DEP is for making the same unfit for human consumption and such addition is required to be done in terms of the statutory requirement under the Medicinal and Toilet Preparations (M TP) Act. The said addition of DEP to ENA cannot be held to be a manufacturing process so as to result in emergence of any excisable product. The ENA was capable of and could have been utilized directly by the appellant but for the requirement of M TP Act. By referring the Hon ble Supreme Court decision in the case of UOI v. J.G. Glass [1998 (97) E.L.T. 5 (Supreme Court)], it stands argued before us that the twin test laid by the Hon ble Supreme Court is not satisfied in the present case. It also stands contended before us that no other manufacturer in the cosmetic industry is paying excise duty on denatured ENA as an intermediate product. 8. The appellants have also challenged the impugned order on limitation on the ground that there was no misstatement or deliberate suppression of facts on their part so as to invoke the longer period of limitation. It is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bove judgments of the Tribunal. The Commissioner in his impugned order has observed that the appellant had been buying the denatured ethyl alcohol from the open market. As already seen, the Tribunal in the case of Charishma Cosmetics never doubted that the denatured ethyl alcohol is an excisable commodity. It was only in the facts and circumstances of the case and keeping in view the process of manufacture and the period for which the said intermediate product emerges, it was held that the same cannot be made liable to excise duty. As such the reference by Commissioner to such purchases may not advance their case. 11. The appellants have strongly contended that their manufacturing process is identical to the process adopted by Charishma Cosmetics and by J.K. Helen Curtis. The Commissioner in his impugned order has referred to and relied upon the report of Assistant Commissioner made by him during the course of his visit to the appellant s factory. The appellants strong grievances that such report was never disclosed to them. In any case the same relates to only one of the products and the manufacturing process of other products were not examined. Further, no comparison in the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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