TMI Blog2007 (8) TMI 239X X X X Extracts X X X X X X X X Extracts X X X X ..... ember 1999. IGPL manufactures components required for assembling manual and automatic garage doors in collaboration with M/s. Gliderol International Private Ltd., (GIPL) Australia. Assessee is licensed for manufacture of manual and automatic doors using technology provided by GIPL. Assessee arranges for installing garage doors cleared at the buyers' premises. Assessee charges the buyers for installation of the garage doors. The Commissioner and the Commissioner (Appeals) considered if IGPL was eligible for SSI exemption in view of the allegation that the assessee had used the brand name of its foreign collaborator. The Commissioner decided the dispute against the assessee whereas the Commissioner (Appeals) decided that the assessee did not use another's brand name and was eligible for the SSI benefit. The Commissioner had decided the following issues in the Order-in-Original No. 04/2002 dated 27.02.2002: (i) Whether IGPL had cleared Rol-A-Dor Glidermatic doors by affixing the brand name of GIPL and thereby wrongly availed the exemption provided under Notification No.1/93 No.9/99. (ii) Whether IGPL had undervalued their goods and collected certain ext ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctured goods for replacement or for exhibition without payment of duty under commercial invoices/delivery challans. Credit availed inputs were also found to have been removed without reversing the credit. Commissioner considered the submission by the assessee that some inputs included in the work sheet annexed to the Show Cause Notice had been received before it was registered with the Central Excise or that credit had not been taken in respect of several such items shown in the Show Cause Notice and confirmed demand of a suitably adjusted amount. The claim was supported by necessary documents/records. It was found that the assessee had availed credit relatable to goods received in April '99 before the goods had been received in the factory. In April '99 assessee had enjoyed exemption from payment of duty. Therefore the irregular credit availed was demanded. Vide the impugned order a total amount of Rs. 40,75,015/- was demanded from IGPL in terms of Section 11A of the Central Excise Act '44 and Rule 57I/57G of Central Excise Rules'44/Rule 12 of Cenvat Credit Rules 2001. A penalty of Rs.34,40,390/ was imposed under Section 11AC of Central Excise Act and rupees five lakhs under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 1500/-. This amount could not be added to the assessable value of the doors cleared by them. The installation work done at the request of the buyers and through contractors was not part of the manufacturing activity relating to the door systems supplied and the amount collected towards the installation was not includible in the assessable value of the doors. Various judicial authorities were cited in support of their plea. 3.2 CBEC had clarified vide Circular F.No. 139/08/2000-CX4 dt. 03.01.2001, that value addition outside the factory of clearance on account of certain processes not amounting to manufacture in a separate unit or by a job worker could not be charged to duty. By Circular No. 643/34/2002-CX dated 1.7.2002, CBEC had clarified that when a machine was cleared from a factory on payment of appropriate duty and later taken to the premises of the buyer for installation and commissioning into an immovable property no further duty was be payable. 3.3 Their purchase order always showed the price of the products and installation charges separately. The Show Cause Notice had proposed to charge duty on the installation charges. There was no allegation that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble and interest under Section 11AB was demandable only when there was suppression of facts. In the instant case there was no suppression of facts. There was no intention on the part of the appellants to evade payment of duty. The entire issue was technical in nature and involved interpretation of statute. In such cases penalty was not imposable. Hence the penalty imposed and order for the recovery of interest was not maintainable in law. The appellants relied on the judgment of the Apex Court in the case of AKBAR BADRUDDIN JIWANI VS CC [1990 (47) ELT 161 (SC)]. Without prejudice to the argument that the appellants were not liable to pay duty as demanded in the impugned order, it was submitted that the appellants were eligible for abatement as per the provisions of Section 4 (4) (d) (ii) of Central Excise Act, 1944. They were entitled for Modvat credit on the raw materials used in the manufacture of finished product for which demand was made. There was no dispute about the purchase of raw materials and usage of the same in the manufacture of finished goods. 5. We have carefully considered the case records and rival contentions. We find that the appellants did not use ..... X X X X Extracts X X X X X X X X Extracts X X X X
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