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TMI Blog2013 (4) TMI 617X X X X Extracts X X X X X X X X Extracts X X X X ..... not exceeding 20 kgs. per unit container and this Notification was further amended by Notification No. 17/98-C.E., dated 18-4-1998 whereby tea put up in unit container of content not exceeding 100 grams per unit container was exempted from excise duty. On a visit to the respondents factory, the officers of Central Excise noticed that small unit containers of tea were packed in larger "bandha packs" wherein it was noticed that each of such "bandha pack'" was containing tea exceeding 100 grams in total weight, when weight of all the small packs packed therein was totalled. Revenue officer was of the view that the respondent required to pay excise duty on such small unit containers of the small packs as no exemption was available of such goods which was cleared in bandha packs. After coming to the above conclusion, a show-cause notice was issued to Unit-1 and Unit-2 of the respondent was adjudicated by the adjudicating authority and confirmed the demand along with interest and also imposed penalty on the assessee as well as personal penalty on an individual. Aggrieved by such an order of the adjudicating authority appeals were filed before the first appellate authority. The first appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lies that the Bandha Pack was sold as such and not sold in retail as has been brought up in the case for seeking relief of exemption. The assessee has in his returns shown the goods cleared by him as having unit weight not exceeding 100 gms. at Nil rate but has cleared packages in Bandha packs exceeding 100 gms. which is a clear case of suppression of material fact in proper assessment of duty of excise, which would attract invoking extended period under proviso to Section 11A of the Central Excise Act, 1944. Moreover, information regarding Bandha Pack was never given to the Department. These facts have been ignored by the appellate authority while deciding the matter. Decision of Hon. CESTAT in the matter of Ammonia Supply Company v. Commissioner of Central Excise, New Delhi as reported in 2001 (131) E.L.T. 626 (Tri.-Delhi) relied upon the Commissioner (Appeals), is not applicable in this case as the above decision relates to filling of liquid ammonia from tankers into smaller cylinder does not amount to manufacture. However, the dispute in the instant case is related to entitlement of benefit of Notn. for availing exemption on clearances where weight is less than 100 gms. Deci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... compass, it has to be decided whether the respondent was eligible for credit in considering available the exemption under Notification No. 17/98 on the Tea pack which were to be put in Bandha Pack by him. On the factual matrix it is undisputed Bandha Pack contained tea bags of 2.5 gm., 5 gm., 25 gm., etc. It is also undisputed that such Bandha Pack containing 2.5 gm., 5 gm., 25 gms., are cleared without payment of duty claiming exemption of Notification No. 17/98, while tea bags which exceeded 100 gm. were cleared on payment of appropriate rate of duty. It is also undisputed that smaller packs which were found in the Bandha Pack contained labels indicating weight, MRP, manufacturer's name, etc. 6. On perusal of the records we find that the appellate authority has given in detail the findings on this issue which are reproduced : "The exemption has been granted for tea put up in unit container bearing the brand name whose quantity is not exceeding 100 gm. it is worthwhile noticing that chapter 0902 is not covered under SSI exemption issued from time to time by the Government of India. It means every manufacturer of tea making a branded tea is liable for excise duty but for any othe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vement, storage, sale and distribution of smaller tea packs to its ultimate consumer in its long journey. Further, what is permissible from door should not be disallowed from windows. As per definition of unit container under Section 11 it had been rightly pointed out by the learned counsel Mr. Dave, it may be such that it bounds the contents tightly and should be in such a shape/size in which it could reach to the ultimate consumer along with its contents. After all, words and phrases had to be construed or interpreted in the context in which those are used or employed. The unit in context of unit certificate under US 64 could be construed accordingly. The unit under Sec. 5(g) of Cardamom Act or under Sec. 106(1) of Air Force Act have a different meaning. The unit generally means a single thing or a person. The meaning of the container normally is a vessel (See Sec. 2C of Agricultural Produce Grading and Marking Act) or anything that contains or that can contain something. So the words together i.e. unit container has to be construed as something which contains predetermined quantity or number and it is capable of movement i.e. meant for exchange or consumption on its own right. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not imaginary rather that really exist in retail market. The tea is being sold along with the packs of lowest denominator. After the use of the tea, the packing material is treated as waste and thrown in dustbin. Therefore it cannot be said for gain sake that small packs consisting of less than 100 gm of tea are not in unit container. It is wise to say that for the purposes of transportation, storage and clearance, the smaller packs had been bunched together, making it for a quantity 2 kg or 3 kg or more, and for that reason the benefit of Notification cannot be extended is too much to be digested. If such construction is adopted then the basic purpose of the exemption Notification itself stands defeated i.e. in manufacture and clearance of tea under Brand Name in a unit container which is less than 100 gms per pack duty will stand changed. The exemption would thus become inoperative or as if redundant. Therefore considering the 'Bandha Pack' only a unit container, is a far fetched argument while giving proper meaning and effect to the exemption Notification 17/98-C.E., dated 18th July, 1998. It is a settled proposition of law that exemption Notification cannot be read as inoperati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of this case, the definition of deemed manufacture does not got fulfilled. Thus it does not advances the case of Revenue." 7. It can be seen from the above reproduced paragraphs of the first appellate authority's findings that he has considered the evidences produced before him about actual facts as well as arguments put forth by the assessee. It can be seen that Revenue is unable to contradict the factual matrix in the grounds of appeals, (which are reproduced in the para 3). In absence of any contrary evidences, the detailed findings recorded by the first appellate authority, remain unrebutted, we hold that Revenue has failed to make out a case. 8. As regards the question on limitation, we find that the assessee has been discharging duty liability on the packages which were more than 100 gms. in weight, but they could be under a bona fide belief that they are not liable to pay central excise duty on the Bandha Pack, as the same had smaller pack, which contained Tea which is less than 100 gms. It is also to be noted that the appellant had indicated in the return, the clearance of Tea Packs are less than 100 gms. The findings recorded by the first appellate authority as regards ..... X X X X Extracts X X X X X X X X Extracts X X X X
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