TMI Blog1984 (1) TMI 327X X X X Extracts X X X X X X X X Extracts X X X X ..... the Appellants ) were engaged in the manufacture of Teleprinter Rolls, Teleprinter Tapes, Waxed Paper and Kraft Ammunition Paper. On 31-1-1975 Central Excise Officers visited the factory of the appellants and on verification of the records and accounts found that the appellants had manufactured, stored and removed 3,38,608.06 Kgs. of such paper without obtaining Central Excise Licence, without payment of duty and without observance of other Central Excise formalities. The Collector of Central Excise, New Delhi by his order dated 13-10-1976 classified these items under Central Excise Tariff No. 17(2) and 17(4) and demanded duty on the said 3,38,608.06 Kgs. of goods in question under Rule 9(2) of the Central Excise Rules. However, no penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision application before the Government of India, (now transferred to the Appellate Tribunal under Section 35P) and is being treated as an appeal. 6. We have heard Shri M. Chandrasekharan with Shri Madhav Rao, Advocates for the appellants and Shri A.K. Jain, S.D.R. for the Department. 7. The first submission made by the learned Counsel for the appellants is that they simply cut the duty paid base paper for making rolls and tapes and where necessary interleave the carbon papers. This cannot be treated a process of manufacture as defined under Section 2(f) of the Central Excises and Salt Act, 1944. According to him the cutting of duty paid paper and packing into rolls and tapes does not turn the paper into another product nor does it br ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tariff. 10. The second submission made by the learned Counsel for the appellants is that the demand of the duty made by the department is barred by limitation of one year as laid down under Rule 10 read with Rule 173J of the Central Excise Rules, 1944. The paper which they had cut into rolls and tapes was already duty paid and the differential duty demanded by the department should have been made within a period of one year as laid-down under Rule 10 read with Rule 173J of the Central Excise Rules, 1944. According to him, the provisions of Rule 9(2) of the Central Excise Rules cannot be made applicable in such cases. He drew our attention towards the Supreme Court decision given in N.B. Sanjana v. E.S. W Mills [1978 Vol. No. E.L.T. (J ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulation but something more is necessary. There must be transformation; a new and different article must emerge, having a distinctive name, character and use. 13. The teleprinter paper or roll as described by the appellants is definitely a different commodity or article from the one used as the base material which is large size or jumboo rolls writing or printing paper. Teleprinter paper or teleprinter rolls is well known in the market and is known as distinct commodity and as such meanings given to articles in a fiscal statute must be as people in trade and commerce, conversant with the subject, generally treat and understand them in usual course. 14. In Kores (India) Ltd. v. Union of India and others [1982 Vol. No. E.L.T. 253 (Bombay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al treatment of Kraft paper, the difference in characteristics and properties between the untreated Kraft Paper and the treated Kraft paper with a view to establish that there has indeed been manufacture for the purpose of Central Excise levy as interpreted by the Supreme Court in its judgments in the Delhi Cloth General Mills case and the South Bihar Sugar Mill s case. We also notice that Ammunition Kraft paper has not been specifically enumerated in the Glossary of terms used in Paper Trade and Industry published by the Indian Standards Institution as IS : 4661-1968. In the circumstances, we hold that the Department has not established their case for levy of excise duty on Ammunition Kraft Paper as a product distinct and different fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his case the appellants never informed the excise authorities nor obtained any licence. The excise authorities were not informed when the goods were cleared and therefore the question of entertaining any doubt as to whether the goods were excisable or not could not have arisen. 18. In N.B. Sanjana s case there was a demand made under Rule 10(A). When those demands were challenged as being untenable under Rule 10(A), demands were sought to be sustained under Rule 9 (2). While dealing with the question as to whether the demands could be justified under Rule 9(2) Supreme Court expressed :- Sub-rule (1) of Rule 9 provides for the time and the manner of payment of duty. In this case there is no controversy that whatever goods were cleared ..... X X X X Extracts X X X X X X X X Extracts X X X X
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