TMI Blog2017 (9) TMI 152X X X X Extracts X X X X X X X X Extracts X X X X ..... 39 of the Central Excise Tariff Act, 1995 - the penalty not leviable - appeal allowed - decided in favor of appellant. - Appeal No. E/283/2007 - Final Order No. 61721/2017 - Dated:- 1-9-2017 - Mr. Devender Singh, Member ( Technical ) Sh. Naveen Bindal, Advocate for the Appellant Sh. Vijay Gupta, AR for the Respondent ORDER Per : Devender Singh The appellants are in appeal against the impugned order. 2. The brief facts of the case are that the appellants are registered with the Central Excise Department for manufacture of plastic toys, storage tanks and other items for use by children. On 24.04.1997, their factory was visited by Central Excise Officers and it was noticed that they had installed injection, moulding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lant filed an appeal against the order of CEGAT in the Hon ble Supreme Court which was decided vide its order dt. 04.02.2005. In the said order, the Hon ble Supreme Court ordered as follow:- For the aforesaid reasons, we hold that the process of pulverization under which granules are converted into moulding powder constitutes manufacture ; that the moulding powder produced by the aforestated process was marketable; that the show cause notice dt. 04.11.1997 was beyond limitation; that the Commissioner (Adjudication) will decide the question of valuation under rule 6(b)(ii) of the Central Excise (Valuation ) Rules, 1975, in the light of the Circulars dt. 04.04.1988, 30.10.1996 and 13.02.2003 issued by the Central Board of Excise Custom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... knowledge of the Department. There was no intention to evade the duty. Ld. Advocate also submitted that moulding powder was not accounted for in RG-1 register as it was not required to because it is not a finished product. He also relied on the following case laws:- 1. O.K. Play (India) Ltd. Vs. CCE, Delhi-III, Gurgaon 2005 (180) ELT 300 (SC). 2. O.K. Play (India) Ltd. Vs. CCE, Delhi-III, Gurgaon 2004 (171) ELT 378 (Tri. Del.). 4. Ld. AR on the other hand argued that they had been purchasing the moulding powder from outside and availing the credit of duty on the same and thus they were fully aware that this product was excisable. He also contended that the contravention has been invoked in the Para 9 of the show cause notice an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he powdering of Low Density Polyethylene (LDPE) and High Density Polyethylene (HDPE) granules into moulding powder would amount to manufacture went for determination right up to before the Hon ble Supreme Court when it was determined by the Hon ble Apex Court that as a consequence of new definition of manufacture in terms of Section 2(f), the activity which otherwise do not amount to manufacture, can now be termed as manufacture and thus liable to duty. This was with reference to Chapter Note 6(b) of Chapter 39 of the Central Excise Tariff Act, 1995. I also find force in the contention of the appellant that they did not start any new activity in the show cause notice and the facts were same and everything was in the full knowledge of the De ..... X X X X Extracts X X X X X X X X Extracts X X X X
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