TMI Blog2016 (10) TMI 906X X X X Extracts X X X X X X X X Extracts X X X X ..... - Dated:- 18-8-2016 - Ms. Sulekha Beevi, Member(Judicial) and Mr. Madhu Mohan Damodhar, Member(Technical) Shri M.S. Nagaraja, Advocate for the appellant. Shri Arun Kumar, Deputy Commissioner(AR) for the respondent. ORDER Details of the appeals involved are as under:- Appeal No. Order-in-Appeal No. Period Differential duty with interest Penalty E/ 188/2007 No.5/2006 (H-III)(D) CE dt. 31/10/2006 January 2004 to August 2004 ₹ 1,34,812/- E/83/2008 No.47 48/2 007 (H-III)CE 22/11/2007 September 2004 to July 2006 Rs.4,21 ,003/- E/740/2008 No.44/2008 dt. 25/06/2008 August 2006 to July 2007 ₹ 1,92,394/- and penalty of ₹ 1,92,394/- under Section 11AC of the Central Excise Act, 1944 2. The brief facts of the case are that M/s. NCL Alltek Seccolor Ltd., the appellant, is a manufacturer of surface coating materials, adhesives, glues and paints. The appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he earlier Order-in-Appeal dt. 31/10/2006. Hence appeal No.E/83/2008 for the period from September 2004 to July 2006 and appeal No. E/740/2008 for the period from 01/08/2006 to 31/07/2007. 3.1 . During the hearing the Ld. Advocate Mr. M.S. Nagaraj made the following main submissions: a. There is no dispute with respect to supply of Superfine Spray Plaster packed in 25 kg. / 30 kg. bags to M/s. NCC-Maytas (JV), Pocharam under invoices. The HDPE/PP bags were marked NOT FOR RESALE The Adjudicating Authority in para 10 of Order-in-original No.41/2005 dt. 27/09/2005 has clearly recorded that M/s.NCC-Maytas was not selling the goods to anybody but was using it themselves in the construction activity. b. The exemption under Rule 34(1)(a) applies to any package containing a commodity if the markings on the package unambiguously shows that the goods have been specially packed for the exclusive use of any industry as a raw material or for the purpose of servicing any industry. In the instant case, the appellants have sold the Surface Coating Material to M/s. NCC-Maytas(JV) for their own use in their construction industry, The use of Surface Coating Material in the construction i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g their ownership will not get exemption from Rule 34 and should be assessed under 4A and not under Section 4 of the Central Excise Act, 1944. He pointed out that the CBEC Board Circular dated 17.01.2007 was issued clarifying earlier circular dated 28.02.2002 that bulk sale of ice-cream in packages to hotel /catering industry is required to comply with the provisions of SWM(PC) Rules 1977 and accordingly assesee is required to declare retail price on such packages. The Ld AR also drew our attention to the Hon ble Supreme Court judgment in the case of CCE, Panchakula Vs. Liberty Shoes [2015 (326) ELT 422 (S.C)] where it was held that since footwear is an item which is specified under Section 4A which is covered by SWM(PC) Rules and MRP was affixed on the products supplied, which were not exempted under Rule 34 of the rules, the provision of Section 4A of the Act shall stand attracted. For these reasons Ld. AR vehemently argued that impugned orders are correct in law and do not call for any interference. 5. Heard both sides and have gone through the records. 6. On appreciating the facts placed before us, we find that the Hon ble Supreme Court in the Jayanthi Food Processing c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oning the retail sale price on that package. All this has been completely missed in the order of the Tribunal. 15. On the other hand the package in question would certainly come within the definition of wholesale package as defined in Rule 2(x)(ii) as it contained the commodity (ice-cream) and was sold to intermediary (Hotel) for selling the same to the consumer in small quantities. Then Rule 29 would apply to such package which does not require the price to be displayed on the package. What is required to be stated is (a) name and address of the manufacturer (b) identity of commodity and (c) total number of retail packages or net quantity. Shri Ravindra Narain is quite justified inrelying on Rule 2(x) and Rule 2(q). The Tribunal does not refer to these vital Rules. 16. There is one more substantial reason supporting the appellant. Shri Ravinder Narain invited our attention to Rule 34 in Chapter V of SWM (PC) Rules which provides for exemptions. We have quoted Rule 34 earlier. The Rule has now been amended. However, under the unamended Rule there is a specific declaration that the SWM (PC) Rules shall not apply to any package containing a commodity if the marking on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tionary means : (i) perform routine maintenance or repair work on (a vehicle or machine); (ii) provide a service or services for; It is an act of helpful activity - help, aid or to do something. It also includes supplying of utilities or commodities. In that view we are not prepared to give a narrow interpretation to the term service any industry . We, therefore, accept the arguments advanced by Shri Ravinder Narain that the package sold by the assessee to the hotel was, apart from being for the exclusive use of the hotel was, also for the purpose of servicing that industry . If that is so, then the SWM (PC) Rules would not apply at all. 17. The Tribunal has given very narrow meaning to Rule 34 by firstly holding that ice-cream is not a raw material . There the Tribunal was right but the Tribunal was not right by holding that the words servicing any industry were not applicable to such package . We, therefore, accept the arguments of the learned Counsel and reject the contention raised by Shri Subba Rao. If that is so, the appeal would have to be allowed and it would have to be held that Section 4A will not apply to the ice-cream sold by the as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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