TMI Blog1983 (12) TMI 293X X X X Extracts X X X X X X X X Extracts X X X X ..... ll scale manufacturer of Motor Vehicle Parts which were not initially specified under Central Excise Tariff Item No. 34A but which subsequently came within the purview of Item No. 68. The Central Excise authorities observed that they had cleared unspecified motor vehicle parts upto a value of ₹ 27,82,911.84 during the period 1-4-1978 to 28-2-1979 and were not, therefore, entitled to exemption either from payment of duty or from licensing w.e.f. 1-3-1979. After issue of a show cause notice and giving the party a hearing, the Assistant Collector observed that the appellants had applied for a licence on 15-3-1979 which they got on 15-3-1979, so the manufacture of parts which were dutiable under Tariff Item 34A till 5-9-1979 at the rate o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were not manufacturing any of the scheduled items and were, therefore, not required to obtain a licence or be under Excise Control. From 1979 the description of Item 34A revised and a number of items were included as dutiable but none of these items also was being manufactured. While introducing the Finance Bill Notification No. 76/79, dated 1-3-1979 was issued which provided that it was not intended that pending enactment of the bill, duty should be levied and collected on such parts and accessories as have not been specified in the said Item No. 34A but classifiable under this item at the rate of duty specified therein. It was further provided that parts and accessories not specified are exempt from duty in excess of 8%. It is argued tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d before clearing the parts. The Appellate Collector neither understood the pleas put forward nor appreciated the orders of the Assistant Collector. His order is confused in regard to applicability of Notification 75/79. The correct legal position is that parts which were not specified were not liable to duty till 1-3-1979. Even after 1-3-1979 by virtue of Notification 75/79 they remained covered by Item 34A but were entitled to duty at 8% instead of 20% A.V. Furthermore, they were exempt from duty if sent under the proper procedure to motor vehicle manufacturers. These points were not appreciated by the Appellate Collector in rejecting the appeal. A copy of letter dated 2-12-1981 certifying that the goods sent from 1-3-1979 to 26-3-1979 to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty setting aside the order of the Appellate Collector which is not based on correct appreciation of the facts and law. 5. Shri Kampani explained the restructuring of Item 34A leading to amendment in the wording of the heading as also the two exemptions No. 75/79 exempting such parts as are used as original equipment and No. 76/79 exempting such specified parts from duty in excess of 8% (as application to T.I. 68) instead of payment at 20% (applicable to parts). All that had happened in this case was a lapse in following the prescribed procedure. No penalty had been imposed precisely because of this. There was no loss of revenue as factually there was no doubt that the appellants were entitled to claim the exemption and the parts were ..... X X X X Extracts X X X X X X X X Extracts X X X X
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