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IFP Petro Product Pvt. Ltd. Versus Commissioner of Central Excise & S.T. Ghaziabad

2016 (9) TMI 1171 - CESTAT ALLAHABAD

Deemed Manufacture - emergence of clean oil through the processes, such as, Dehydration, Distillation, Clay Polishing and Filtration from waste and used oil - clean oil were packed in bulk packs of drum and sold to industrial customers - application of Chapter note 4 of Chapter 27 of schedule to the Central Excise Tariff Act, 1985 - Held that:- for applying the Chapter note 4 to any goods for examining, whether, manufacture has taken place, it is essential to establish (i) either there is labeli .....

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marketable to consumer. All the invoices were for bulk packing and sold to industrial customers. Further, there was no evidence of labeling or re-labeling or for re-packing into retail packs. We, therefore, hold that all the show cause notices involved in the four appeals in hand lack, prima facie, evidence for leveling charges leveled and unsustainable. Hence, the two Orders-in-Original impugned in four appeals in hand, are set aside. - Decided in favour of appellant - E/1350, 1351/2012 & E/51 .....

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tral Excise & S. Tax, Ghaziabad. 2. The brief facts of the cases are that the appellants procured waste and used Oil from service stations of Honda, Maruti Udyog, etc. and subjected such waste and used Oil to certain processes, such as, Dehydration, Distillation, Clay Polishing and Filtration and the goods emerged clean oil were packed in bulk packs of drum and sold to the industrial customers. It appeared to Revenue that in view of Chapter note 4 of Chapter 27 of schedule to the Central Exc .....

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he appellants, before the Original Authority, relied upon the decisions of Hon'ble CESTAT in the cases of M/s Mineral Oil Corporation Vs. Commr. of Central Excise, Kanpur: 1999 (114) E. L. T. 166 (Tribunal) and M/s Raj Petrochem Industries Vs Commr. of Central Excise &Customs, Vadodara : 2001 (129) ELT 186 (Tri.-Mum.) wherein this Tribunal had held that refining of old and used oil did not amount to manufacture. Further, they contended that removing impurity does not change the compositi .....

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nder the product marketable to the consumer amounts to manufacture and therefore, he has confirmed the demand. In the said adjudication, the Original Authority has also clubbed another show cause notice dated 29.11.2011, for the period from 01.11.2010 to 31.08.2011 and confirmed the demand of Central Excise duty amounting to ₹ 2,54,82,271/-. He also directed the appellants to pay interest and imposed equal penalty on the appellants and imposed penalty on ₹ 10 lakhs on Mr. Anant Bhrga .....

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/2014-15 dated 20th January, 2015. Through the Order-in-Original dated 20th January, 2015, Original Authority on similar lines, confirmed the demand of Central Excise duty amounting to ₹ 2,23,55,726/- and imposed equal penalty, Original Authority also directed the appellants to pay interest. Through said order, personal penalty of ₹ 20 lakhs was imposed on Mr. Anant Bhargava, Director of appellants' company. Challenging the said Order-in-Original dated 20th January, 2015, appella .....

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s of Note 4 to Chapter 27 in their case is improper. They further argued that there is no labeling or re-labeling of container and that there is no repacking from bulk to retail pack involved in their cases. They further emphasized that there should be adoption of any treatment to the goods to render them marketable to the consumer, as a requirement for applying the said Chapter note 4 and they contended that the said Chapter note 4 is not applicable to them. They have also contended that extend .....

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r appeal No.E/1350/2012 and argued that the ingredients in the Chapter note 4 are that either the goods are to labeled or re-labeled, or there has to be re-packing from bulk packs or the treatment adopted should render the product marketable to consumer, then alone such activity will amount to manufacture. He has argued that in the show cause notice, it is not established that the processes adopted by them, renders the treated waste oil marketable to consumers. In fact, the treated oil was remov .....

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