TMI Blog2014 (11) TMI 423X X X X Extracts X X X X X X X X Extracts X X X X ..... out a prima facie case either for a waiver of pre-deposit in totality or for an order to the effect that a further amount of ₹ 20 lacs, as stated on behalf of the assessee, would amount to a fair order on the application for waiver of pre-deposit. Having due regard to the quantum of duty demand of ₹ 3.85 crores, an order for the deposit of ₹ 20 lacs over and above the amount of ₹ 40 lacs, which has already been deposited by the assessee, cannot be regarded as amounting to a proper exercise of the discretion in law by the Tribunal. We are of the view that the ends of justice would be met if the assessee is directed to deposit a total amount of ₹ 1 crore after giving due credit for the amount of ₹ 40 lacs, which has already been deposited by the assessee. - Stay order of the tribunal modified - Decided in favor of revenue. - Central Excise Appeal Defective No. - 110 of 2014 - - - Dated:- 30-10-2014 - Hon'ble Dr. Dhananjaya Yeshwant Chandrachud,CJ And Hon'ble Pradeep Kumar Singh Baghel,JJ. For the Appellant : Sr. S.C. For the Respondent : Parv Agarwal, Rahul Agarwal ORDER The appeal by the Revenue arises from a dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bench? iii) Whether, Hon'ble third Member of CESTAT was justified in deciding the points of difference, on the basis of fresh evidence? The appeal is admitted on these questions and by consent, has been heard for final disposal. The assessee carries on activities of printing and lamination of poly films and has two factories at Varanasi and at Rudrapur. Proceedings were initiated after a search was conducted by the Directorate General of Central Excise Intelligence on the basis of the information received that neither of the units were registered with the Central Excise Department though they had a turn over in excess of ₹ 14 crores. The case of the assessee was that its customers deposit the plain poly film rolls as raw material and the assessee carries out job work thereon. Notices to show cause were issued to the assessee on 9 February 2011 and 5 September 2011 inter alia for recovery of central excise duty, which had not been paid. The basic allegation was that the assessee had removed dutiable goods clandestinely and had suppressed its production. The notice to show cause dated 5 September 2011 alleged that there was a willful suppression of facts with an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al manufacturers were not registered under the Central Excise and were neither paying central excise duty on the goods received from the assessee nor were they using the same in the manufacturing of dutiable goods. The procedure prescribed in the exemption Notification No. 214/1986-CE dated 25 March 1986 was found to have not been followed and no undertaking, as required, had been filed. Accordingly, it was held that the goods which were manufactured by the assessee on so called job work basis were not exempted from duty. Moreover, reliance was placed on the statement of the Managing Director of the assessee that the unit was undertaking manufacturing activity without obtaining central excise registration and was clearing the goods without payment of excise duty. The second Member held that the manufacturing process was explained in the statement of the Managing Director and the assessee was not doing only printing alone or lamination alone but both the activities. The second Member held that when both the processes are taken together, a new and distinct commodity comes into existence which is printed and laminated plastic film and once it is printed in accordance with the requirem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n on the part of the assessee and no central excise registration had been obtained. In these circumstances, it has been submitted that a direction for deposit only of an amount of ₹ 20 lacs (in addition to the amount of ₹ 40 lacs already deposited) is not appropriate and proper particularly since the duty demand, which has been confirmed, is in the amount of ₹ 3.85 crores. On the other hand, learned counsel appearing on behalf of the assessee has submitted that the issue as to whether the activity of the assessee, which involves printing and lamination is a manufacturing activity, requires to be decided by the Tribunal in the light of conflicting judgments and once it is held that the law on the subject is ambiguous, an order for dispensation of deposit would be justified. Moreover, it was submitted that in such an event, the extended period of limitation cannot be invoked. In the alternative, it was urged that even if the activity of printing and lamination is held to amount to manufacture, then the final product would yet constitute printed material attracting a nil rate of duty under Chapter 49 of the Central Excise Tariff. Learned counsel relied upon certai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... coupled with the facts which have been discussed in the order passed by the Member (Technical). Those aspects in the order by the Member (Technical) had not been analysed or dealt with either in the order that was passed by the Member (Judicial) or in the order of the third Member, to whom the reference proceeded. Admittedly, in the present case, the assessee had not obtained central excise registration. The principal manufacturers, from whom the assessee had obtained the poly film allegedly on job work basis, were not registered for the purposes of central excise and were not found to be paying central excise duty on the goods received from the assessee nor were they found to be using the goods in the manufacture of dutiable goods. The Managing Director of the assessee admitted during the course of his statement that the assessee was undertaking manufacturing activity without obtaining central excise registration and was clearing the goods without payment of excise duty. These facts cannot simply be brushed aside particularly at the prima facie stage while considering an application for waiver of pre-deposit. On these facts, it cannot be held that the assessee had made out a prima ..... X X X X Extracts X X X X X X X X Extracts X X X X
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