9911796707
TMI Blog2011 (1) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... . 2. The appellant herein is a manufacturer of electronic transformers, semi-conductor devices and other electrical and electronics equipments. During the course of such manufacture the appellant also manufactured machinery in the nature of testing equipments to test the final products of the assessee company costing Rs. 31,27,405/- as per Note 6 of the Schedule `Q' page 15 of the balance sheet for the year ending December, 1987. The aforesaid position was further reiterated in the Director's report appearing at page no. 2 of the Annual Report for the year ending December, 1988. 3. A show cause notice was issued to the appellant directing them to show cause as to why central excise duty should not be levied on it along with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en the aforesaid processed material was not marketable. 4. The Additional Collector, Central Excise under order-in-original No. 6/92-93 dated 27.5.1992 after consideration of the contentions confirmed the demand of duty amounting to Rs. 4,92,566.28 and imposed a penalty of Rs. 50,000/- holding that in view of the documentary evidence and the balance sheet it had been proved beyond doubt that they had manufactured plant and machinery/testing equipments worth Rs. 31.26 lacs. Being aggrieved by the said order, an appeal was filed before the Collector (Appeals), who dismissed the said appeal. Still aggrieved, the appellant filed an appeal before the CEGAT which was also rejected after hearing the counsel appearing for the parties and af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the said records. 7. The demand for payment of central excise duty in the present case appears to have been made on the basis of statement made by the appellants in their balance sheet to the effect that there is an addition to plant and machinery including testing equipments worth Rs. 31.26 lacs which have been made in the company by capitalisation of the expenditure on (i) raw material, (ii) stores and spares and (iii) salary/wages and other benefits. The aforesaid statement and details were mentioned in Schedule `Q' appended to notice of balance sheet and profit and loss account of the appellant for the year ending December, 1987. Serial No. 6 of the said Schedule reads as follows: - "Addition to plant and machi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ines in the nature of testing equipments worth Rs. 31.26 lacs to test the final products manufactured by them. 10. Even if such equipments were used for captive consumption and within the factory premises, considering the fact that they are saleable and marketable, we are of the view that duty was payable on the said goods. The fact that the equipments were marketable and saleable is also an admitted position as the appellant has admitted it in their reply to the show cause notice that they had undertaken such manufacturing process of the testing equipments to avoid importing of such equipments from the developed countries with a view to save foreign exchange. Such a statement confirms the position that such testing equipments were ..... X X X X Extracts X X X X X X X X Extracts X X X X
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