TMI Blog2010 (8) TMI 366X X X X Extracts X X X X X X X X Extracts X X X X ..... labelling etc. of bulk packs of such goods and, therefore, during such period, the appellant was not liable to pay duty on the retail packs. Appellant is entitled to exemption from payment of duty on the retail packs of goods falling under Headings 33.01 and 33.02 for the entire period of dispute and partial exemption from payment of duty in respect of the retail packs of goods falling under Heading 33.07, the duty liability in the latter case arising only w.e.f. 1-3-2003. It goes without saying that, when duty is paid on the finished goods (retail packs), CENVAT credit of the duty paid on inputs should be allowed to the manufacturer. This aspect should also be covered in de novo proceedings. As regards penal liability under Section 11AC, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. An earlier deposit of Rs. 4,75,882/- was appropriated towards the above demand. The adjudicating authority also denied CENVAT credit to the extent of Rs. 4,25,652/- to the appellant in respect of bulk goods (inputs). The appeal filed by the assessee against the order of adjudication was rejected by the Commissioner (Appeals). Hence the present appeal. 3. The activity of repacking of bulk packs into smaller retail packs was undertaken in respect of organic compounds of Chapter 29, essential oils of Chapter 33 and miscellaneous chemical products of Chapter 38. No duty was paid on these smaller retail packs. At this stage, the appellant has, fairly, acknowledged the applicability of the relevant Chapter Notes (embodying deemed manufa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such goods for the period prior to1-3-2003. We have heard the learned SDR also, who has also taken note of the relevant Chapter Notes and the relevant amendment of Section 2(f) of the Act. On a perusal of the impugned order, we have found the above submissions of the Consultant to be correct in so far as the goods falling under Headings 33.01, 33.02 and 33.07 are concerned. 5. As the lower appellate authority itself has accepted the assessee s contention that, in respect of goods falling under Headings 33.01 and 33.02, repacking of bulk packs into smaller retail packs or re-labelling thereof did not amount to manufacture for the purpose of levy of duty, the appellant is entitled to the benefit in respect of these goods. We further note ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner (Appeals) could not direct such re-quantification of duty for want of the power of remand. 7. For the reasons already noted, we hold that the appellant is entitled to exemption from payment of duty on the retail packs of goods falling under Headings 33.01 and 33.02 for the entire period of dispute and partial exemption from payment of duty in respect of the retail packs of goods falling under Heading 33.07, the duty liability in the latter case arising only w.e.f. 1-3-2003. It goes without saying that, when duty is paid on the finished goods (retail packs), CENVAT credit of the duty paid on inputs should be allowed to the manufacturer. This aspect should also be covered in de novo proceedings. As regards penal liability under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X
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