TMI Blog2013 (6) TMI 633X X X X Extracts X X X X X X X X Extracts X X X X ..... ly or balance of credit available, whichever is lower. Matter referred to 3rd member. - E/86389/2013-Mum - M/1104/13/EB/C-II - Dated:- 15-5-2013 - Ashok Jindal And P K Jain, JJ. For the Appellants : Shri V Sridharan, Sr. Adv. With Shri. Prakash Shah, Adv. For the Respondent : Shri K L Goyal, Commissioner (AR) Per: Ashok Jindal: The applicants are seeking waiver of pre-deposit of the following demands confirmed by way of the impugned order: a) Demand for the wrongly availed credit of Rs. 23,02,53,752/-. b) Rebate erroneously granted on the duty on exported goods by utilizing irregular availed credit to the tune of Rs. 13,22,30,368/- c) Interest on the above a b and penalty of Rs. 23,02,53,752/-. 2. The brief facts of the case are that applicant is procured Coco Butter and Coco Powder from their factory at Jammu at Taloja. As far as unit is located in Jammu, the goods are cleared to the applicant on payment of duty and applicant took the credit of the duty paid by their Jammu unit. The applicant also import the Coco Butter Coco Powder on payment of duty. The applicant also takes the credit of duty their on thereafter applicant affixed two lab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the other hand Ld. Commissioner (A.R.) strongly opposed the contention of the Ld. Counsel and submitted that mere putting label A label B does not amount to manufacture as the same does not make the product more marketable to the consumer as per Note 3 to Chapter 18 of the Central Excise Tariff Act, 1985. Therefore, applicant has not made out a case for waiver of pre-deposit. Accordingly, applicant be asked to make pre-deposit of the entire amount. 5. Heard both sides. 6. We note that mere labeling would not amount to any activity as held by this Tribunal in the case of M/s. Sree Leathers vs. CCE, Kolkata-V reported in 2012 (275) ELT 225 (Tri-Kolkata). Therefore, prima facie we are not convinced with the arguments of the Ld. Counsel that activity labeling amounts to manufacture. The issue whether the activity of amounts to manufacture or not shall be dealt in detail at the time of final hearing. We find that the impugned goods are factory stuffed goods and at the time of stuffing, the concerned Range Inspector of Central Excise has verified that CENVAT Credit not availed wrongly thereafter the factory stuffing was allowed. Further, the rebate claim has been sanctioned to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tries other than Nepal and Bhutan. Clause (2) of the said notification details "Conditions and limitation "Sub-Clause (h) of Clause (2)- which is relevant for the present case reads as under:- "(h) that in case of export of goods which are manufactured by a manufacturer availing the notifications of the Government of India in the Ministry of Finance (Department of Revenue) No. 32/99- Central Excise, dated the 8th July, 1999 [G.S.R. 508(E), dated the 8th July, 1999] or No. 33/99- Central Excise, dated the 8th July, 1999 [G.S.R. 509(E), dated the 8th July, 1999] or No. 39/2001-Central Excise, dated the 31st July, 2001 [G.S.R. 565(E), dated the 31st July, 2001] or notification of the Government of India in the erstwhile Ministry of Finance and Company Affairs (Department of Revenue) No.56/2002-Central Excise, dated the 14th November, 2002 [G.S.R. 764(E), dated 14th November, 2002]or No.57/2002-Central Excise, dated the 14th November, 2002 [ GSR 765(E), dated the 14th November, 2002 ] or notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 56/2003-Central Excise, dated the 25th June, 2003 [ G.S.R. 513 (E), dated the 25th June, 2003] or 71/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... GROSS WT. 25.750 KG BATCH NO. BOX NO [FOR EXPORT ONLY] STORE AWAY FROM HEAT STORE IN A COOL, DRY, HYGIENIC PLACE AWAY FROM ANY SOURCES OF HEAT (Container wise Sr. No. is put up in Label -A) AND 2. LABEL - B JINDAL COCOA BUTTER (Natural PPP) Manufactured Marketed by: Jindal Drugs LIMITED 229, Nariman Point, Mumbai - 400 021 India Labelled at Jindal Drugs Limited, 111, MIDC, Taloja - 410 208 on- (Packing date is mentioned in Label -B) 13. It is to be noted that all the information indicated in two extra labels is already available in earlier Labels. I do not find any purpose of putting these extra labels from marketing or consumer or purchaser's point of view, except committing fraud on public exchequer by claiming refund second time (in the name of manufacture at Mumbai). 14. Note 3 of chapter 18 reads as under: " 3 In relation to products of this chapter, labeling or relabeling or repacking from bulk packs to retail packs or the adoption of any other treatment to render on product marketable to the consumer, shall amount to manufacture." 15. The concept of manufacture ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s specifically prohibited in respect of goods produced, availing exemption, same cannot be permitted in the above manner. 18. My Ld. Brother in respect of extended period has observed that the impugned goods are factory stuffed goods and at the time of stuffing, the concerned Range Inspector of Central Excise has verified that the Cenvat Credit not availed wrongly thereafter the factory stuffing was allowed. Further, rebate was sanctioned after the following procedures. I am unable to agree with my Ld. Brother both on assumed facts and conclusion. Factory stuffing in presence of Central Excise Officer only implies that the goods stuffed in the export container are as per the description and quantity gives in invoice and packing list. The Officer only certifies the quantity and description of goods stuffed in the containers. Inspector is not required to verify the Cenvat Credit taken or activity amounts to manufacture or not or any other thing under the Excise Law during factory stuffing. Facility of factory stuffing is only to obviate the need of examining the goods import area by Customs. Central Excise Rules 2002 or Cenvat Credit Rules 2004 do not require even to examine the go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any prima facie case. Even my Ld. Brother is of this opinion. On the contrary, case appears to be strongly in favour of Revenue. As far as balance of convenience is concerned, in this case what is being demanded is rebate of duty paid second time and the credit of duty taken in Mumbai. As discussed earlier, applicant has got back refund of duty paid twice, one at Jammu and second time as rebate in Mumbai. What is being asked to pay back is refund of duty paid in Mumbai. Even after paying this to Revenue, applicant will continue to retain the refund of duty paid in Jammu. In view, balance of convenience therefore lies in ensuring that the amount of rebate is deposited back to the public exchequer. As far as demand of credit taken is concerned, a part of it was utililzed for payment of duty. To that extent it will not be appropriate to ask that. As far as balance credit amount is concerned, that must be freezed till the disposal of appeal. In connection with balance of convenience, Hon'ble Supreme Court in the case of Dunlop India Ltd. and other reported in 1985 (19) ELT (S.C.) has gone to the extent of saying that even if there is prima facie case in favour of company, it is no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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