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TMI Blog2011 (3) TMI 384X X X X Extracts X X X X X X X X Extracts X X X X ..... th Rule 57AH of the Central Excise Rules, 1944 (CER). He confirmed demand of Rs. 33,303/- being the duty due on the tractor cleared availing inadmissible exemption under Notification No. 10/97-C.E. The original authority also imposed penalty equal to the demands working out to Rs. 47,075/- under Section 11AC and Rule 57AH(2) of the CER. The impugned order sustained the above orders of the original authority. 2. The impugned order is assailed on the following grounds :- (a) Demand of duty on scrap not returned to the assessee by the job workers was barred by limitation. The adjudicating authority had confirmed the demand without rendering any finding on the question as to whether there was any intention on the part of the appellant to evade the payment of duty confirmed. In the absence of such a finding, the demand confirmed by invoking extended period of limitation cannot be sustained in law. The adjudicating authority had held the waste involved to be marketable relying on the certificate of a job worker M/s. Sastha Engineering Works. The job worker had stated categorically that the waste was not sold and that it was disposed of along with industrial waste. This had in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Based on the above decisions, it is submitted that where failure to pay duty is not willful/deliberate or with intention to evade payment of duty, then it is not a case falling within the proviso to Section 11A of the Act; such a case would not be one of suppression or willful failure to pay duty with intent to evade. The failure to pay the differential duty had arisen due to a reasonable understanding of the law by the appellant. It was up to the Revenue to establish that the assessee had evaded the short paid duty willfully. This onus was not discharged in the instant case. The statement of Shri Ravindra Adiga indicated that such failure on the part of the assessee was neither deliberate nor intentional. Commissioner (Appeals) had not applied his mind while sustaining the demand raised invoking extended period of limitation. In the circumstances, penalty could not have been imposed invoking Section 11AC of the Act. The Department had not established that the dust generated in the job work process was marketable and therefore excisable. The impugned scrap arose in the process of machine drilling and grinding. The same was in fine powder form and got absorbed in the atmosphere or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the demand without rendering a findings as to whether there was any intention on the part of the appellant to evade the payment of duty confirmed. (d) Ld. Chartered Accountant for the appellant relied on the following decisions of the Tribunal :- (a) P.L. Haulwel Trailers v. CCE, Chennai [2002 (142) E.L.T. 204 (Tri. Chennai)] In this case, the appellants had removed one 12T payload single axle skeleton flat bed semi trailer in respect of which the Department had sought to deny the exemption availed under Notification No. 10/97 and recover the concession availed. The Tribunal found that the item involved was being used as an apparatus for carrying scientific equipment as certified by the Deputy Secretary to the Government of India (Department of Atomic Energy). The trailer involved was held to be entitled to the exemption. (b) Devi Ahilya Vishwavidyalaya v. CC (Sea), Chennai [2002 (146) E.L.T. 407 (Tri. Chennai)] In this case, the Tribunal was concerned with the scope of Customs Notification No. 51/96-Cus., dt. 23-7-1996 containing identical conditions as Notification No. 10/97-C.E. The Tribunal held that the Mer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the light of the various judicial authorities. 3. Ld. Jt. CDR submitted that the scrap generated was classifiable under an appropriate entry in the tariff and duty demanded was payable. As regards the exemption to the tractor-cum-trailer cleared to NAL he submitted that it was for the departmental authorities to decide whether the goods were entitled to exemption or otherwise. The notification did not authorize heads of various institutions specified in the said notification to decide and certify which of the equipments, apparatus or parts and accessories thereof were entitled to the exemption extended under the said notification. He submitted that tractor with trailer cleared by TAFE was not a scientific or technical instrument, apparatus, equipment or accessory of such an instrument or equipment and therefore, the same was not entitled to exemption. One of the conditions for allowing the exemption was that the institution receiving the goods was a public funded research institution under the administrative control of the Department of Space or Department of Atomic Energy or the Defence Research Development Organisation of the Government of India and produced a certificate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of the job workers may not be recoverable or capable of re-melting or rolling. They being borings and sweepings, such scrap would merit exclusion from the purview of waste and scrap covered under Chapter Heading 72.04. Allowances were to be made in respect of irrecoverable scrap before quantification and subjected to levy of duty. 6. In the instant case, the Original Authority accepted certificates produced by four job workers to the effect that the scrap involved was not marketable. However, such certificates were not produced in respect of the other job workers. The Commissioner did not treat the scrap generated at the premises of other job workers as not excisable. He refrained from demanding duty in respect of job workers who had produced certificates. However, the duty liability in respect of these job workers was between Rs. 2/- to Rs. 134/- whereas the liability in respect of a few other job workers was much higher. The original authority did not have the advantage of the finding and reasoning of the Additional Commissioner, Chennai on the same issue in respect of the assessee's sister unit as the said order was not produced before him. We note that the lower author ..... X X X X Extracts X X X X X X X X Extracts X X X X
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