TMI Blog1985 (8) TMI 362X X X X Extracts X X X X X X X X Extracts X X X X ..... some further processes. The soap stone powder so obtained is used as a filler in the manufacture of paper, soap, rubber etc. Finely ground soap stone powder is also used as the base for manufacturing talcum powder which is a cosmetic. The appellants were reportedly supplying their soap stone powder to paper mills and soap manufacturers. The common point of dispute in these two appeals is whether soap stone powder is exigible to duty under Item 68 of the Central Excise Tariff. If the answer to this question is in the affirmative, the other two connected issues to be considered are whether the appellants were entitled to exemption as a small scale unit under Notifications Nos. 89/79-C.E., dated 1-3-1979 and 105/80-C.E., dated 19-6-1980 and w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ealised by them, and not the full value of the soap stone powder, wherever they did the grinding on job work basis. By doing so the total value of their clearances would remain within the ceiling limits of ₹ 30 lakhs per annum and they would become eligible to avail of the total exemption from duty under Notifications Nos. 89/79-C.E., dated 1-3-1979 and 105/80-C.E., dated 19-6-1980. (4) Further, for counting the value of their total annual clearances, the elements of freight, sales tax, octroi and packing charges should be deducted from the value. They had claimed such deductions before the Collector in their reply to the show cause notice but the Collector dealt with the point relating to packing charges only and did not deal with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ants came out with a new complaint that the figures on which the demands for duty were based had not been disclosed to the appellants. The Bench observed from paragraph 7.2 of the first Order-in-Original and paragraph 3.2.5 of the second Order-in-Original that the Collector had made available to the appellants whatever facts and figures they had wanted to know and that thereafter the appellants did not make any further complaint to the Collector in this behalf. Still, in the interest of justice, the Bench was willing to adjourn the hearing so as to give time to the learned Representative of the Department to go into the new point and the document connected therewith which the appellants wanted to tender. However, at this stage the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that while the lumps were having a yellowish colour, the powder was white. However, we do not place much importance on this colour factor alone; the more important thing is the use of the material. None of the industries for which soap stone powder is intended, can use the soap stone lumps. The lumps are totally useless for them. They become usable as raw material by the user industry only after they have been powdered to the required fineness. It is only in powder form that the material becomes marketable to the user industry. There was a direct authority in the form of an order of this Tribunal on soap stone powder itself [1984 (18) E.L.T. 657 (Tribunal) - Oriental Talc Products Pvt. Ltd, Udaipur v. Collector of Central Excise, Jaipur]. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... their Udaipur unit had issued them a show cause notice on 18-6-1979. The appellants sought to say that at least from this date onwards the Department knew of their existence and their operations. We do not find any substance in their argument. As already stated by us, the two factories fell in the jurisdiction of two different sets of officers. Just because the appellants received a show cause notice in respect of their Udaipur unit from the officers of Jaipur Collectorate, it would not mean that the officers of Indore Collectorate became aware of the existence and operations of their Ratlam unit. The fact that even after receipt of the show cause notice dated 18-6-1979 in respect of their Udaipur unit, the appellants did not voluntarily c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the turnover ceiling limit. By doing so, the appellants exceeded the stipulated ceiling limit and became ineligible for these exemptions. 10. Regarding the packing charges, the appellants stated that gunny bags were durable. We find that while new gunny bags, or even those of comparatively good quality, may be capable of re-use, the same cannot be said of not so good gunny bags. There is no evidence as to what quality of gunny bags the appellants used for packing their soap stone powder. At any rate, there is no evidence of any agreement between the appellants and their customers which made the gunny bags returnable to the appellants. There is absolutely no evidence whether any gunny bags were actually returned to the appellants and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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