TMI Blog2012 (5) TMI 248X X X X Extracts X X X X X X X X Extracts X X X X ..... gh Speed Diesel (HSD in short), Superior Kerosene Oil (SKO in short) etc. falling under chapter 27 of Central Excise Tariff Act, 1985 till 01.09.2004 and clearing the same on payment of duty. After 01.09.204, they received duty paid MS in their ware house and distributing the same to their buyers/depots after adding Multi-Functional Additive (MFA in short) to the said MS denoting the same as 'Speed'. It is the case of the Revenue that they are manufacturing 'speed' brand petrol by the process of blending of petrol and Multi-Functional Additive. Consequently, they are issued with a show cause notice on 30.11.05 demanding duty of ₹ 18,55,20,285/- and Education Cess of ₹ 36,79,025/-. 2. Learned Commissioner of Central Excise, Patna has confirmed the duty including cess of ₹ 15,26,92,645.00 and imposed equivalent penalty, observing that the process of blending of MS with MFA results into a product called as 'speed' having different physical and chemical characteristics, nomenclatures and uses. The said new product is not only costlier to the normal MS but is more efficient in its utility also. He has reasoned that addition of MFA increases t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no difference in the critical parameter of flash point, which is same at less than 25 degree centigrade, as required under the Supplementary Note (e) of Chapter 27, which according to them, supports their case that both the products are one and the same. 3.2. In support of their submission, they have relied upon the ratio of the Hon'ble Apex Court in the case of Union of India vs. JG Glass Industries reported in 1988 (77) ELT 5 (SC) , wherein their Lordships have held that by the process of printing names or logos on a bottle does not make the printed bottle a new commodity. Hence, no manufacturing process is involved. Further, in support of their contention that no new product comes into existence, they have also relied upon the following judgements of the Hon'ble Supreme Court:- (i) CIT vs. Tara Agencies 2007(214) ELT 491 SC; (ii) Shyam Oil Cake vs, CCE 2004 (174) ELT 145 SC; (iii) CCE vs. S R Tissues Pvt. Ltd. 2005 (186) ELT 385 SC; (iv) Metlex (I) Pvt. Ltd. vs. CCE 2004 (165) ELT 129 SC. 3.3. The Appellant has submitted that in their own case, the Hon'ble Tribunal has decided the issue in their favour involving identical facts, as reporte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is partly barred by limitation. They have placed reliance on a recent judgment of the Hon'ble Supreme Court in the case of Commissioner of Central Excise Bangalore-II vs. M/s. Osnar Chemical Pvt. Ltd. , wherein at para 23, their lordships have held that the process of mixing polymers and additives with bitumen does not amount to manufacture as the said process merely resulted in the improvement of quality of bitumen and Bitumen remains as Bitumen only; there is no change in the characteristics or identity of bitumen and only its grade or quality is improved. It is observed that the said process does not result in transformation of bitumen into a new product having a different identity, characteristic and use. The end use also remains the same, namely for mixing of aggregates for constructing the roads. 4.1. Per contra, the learned AR for the Revenue submitted that the reliance placed by the learned Advocate for the Appellant on the case of Hindustan Petroleum Corporation' Ltd.(supra) is not binding on the Bench as the said decision has been taken on appeal before the Hon'ble Supreme Court and the Civil Appeal has been admitted. In support of his submission, he plac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ging out of a process of blending, which is evident from the fact that there is a significant value addition based on blending of petrol. He has referred to the judgement of the Hon'ble Supreme Court in the case of Decorative Laminates (India) Pvt. Ltd. vs. CCE, Bangalore reported in 1996 (86) ELT 186 (SC) , wherein their Lordships had observed that value addition' is one of the factors under consideration in examining whether the process of manufacture took place or otherwise. He has also referred to the judgement of the Hon'ble Supreme Court in CCE, New Delhi-I vs. S.R.Tissues Pvt. Ltd. reported in 2005 (186) ELT 385 (SC) on the same issue. 4.4. Learned AR supported the findings of the Adjudicating Authority recorded at paras 14 and 15 of the impugned Order, in advancing his argument that there is a change in the nomenclature, characteristics and usages, after blending MS with MFA resulting into emergence of a new product namely, 'speed'. Learned A.R. has also referred to the ratio of the Tribunal Order No. A-118-119/KOL/2011 dated 20.04.2011 in the case of CCE, Patna vs. IOC, Barauni, wherein it has been held that blending of imported superior kerose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... meaning and scope of manufacture as defined under Section 2(f)(i) of the Central Excise Act, 1944. On the other hand, the submission of the Appellant is that the duty paid MS and MS Speed are one and the same, and there is no change in basic characteristics, usages and specifications on blending MS with MFA hence the process of mixing/blending does not result into manufacture as defined under Section 2(f) of CEA,1944 and accordingly MS Speed is not exigible to duty again. We find that similar issue on identical facts where in the Appellant was also a party relating to their other unit, came before the Coordinate Bench of this Tribunal in the case of Hindusthan Petroleum Corporation Ltd. vs. CCE, Delhi Rohtak reported in 2009 (234) ELT 648 . After considering at length the arguments advanced from both sides, almost on similar lines presented before us, the Tribunal has come to the conclusion that the process of mixing duty-paid MS, with MFA does not result into a new produce and hence the process of blending/mixing of MS with MFA is not a process of 'manufacture' as defined under Section 2(f) of the Central Excise Act, 1944. The finding of the Bench is recorded at para 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re, the process of blending ordinary MS or HSD with MFA to make branded MS or branded HSD, does not amount to manufacture. 5.3. Learned A.R. appearing for the Revenue argued that the observations of the Tribunal in the HPCL case (supra) is not binding on the Tribunal in view of the ratio of the Hon'ble Supreme Court in West Coast Paper Mills Ltd.(supra). Countering the said argument, learned Advocate appearing for the Appellant referred to the judgement of the Hon'ble Supreme Court in the case of Kunhayammed vs. State of Kerala (supra), specifically drew our attention to para 14(4) of the cited judgement which reads as under: 14....................................In our opinion, the legal position which emerges is as under:- 1. xxx 2. xxx 3. xxx 4. In spite of a petition for special leave to appeal having been filed, the judgment, decree or order against which leave to appeal has been sought for, continues to be final, effective and binding as between the parties. Once leave to appeal has been granted, the finality of the judgment, decree or order appealed against is put in jeopardy though it continues to be binding and effective between the pa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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