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TMI Blog2023 (3) TMI 1121X X X X Extracts X X X X X X X X Extracts X X X X ..... de the demand of duty on the ground that the Show Cause Notices issued are time-barred. 2. Brief facts are that the respondents are manufacturers of safety matches falling under Chapter 36 of the First Schedule to CETA, 1985. Upon investigation, it was noticed that the respondents procured 'chemical dipped match splints' in bulk from mechanized match manufacturers like Saraswathi Match Industries, Peraiyur and We Two Match Industries, Sivakasi. These dipped match splints procured by them were packed in veneer or cardboard match boxes of 50 sticks each and affixed labels, packed again into bundles and sold them in market for retail consumption. While clearing such safety matches, the respondents claimed the benefit of full exemption from ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a match box including the outer slide or the inner slide with the use of match paper (ii) Frame filling (iii) Dipping of splints in the composition for match heads (iv) Filling of boxes with matches (v) pasting of labels on match boxes of veneers or cardboards and (vi) packings 4. Learned AR stressed that it is admitted by the respondents that the dipping of splints has been carried out with the aid of power. In other words, the respondents have purchased dipped match splints from manufacturers / suppliers who have manufactured the dipped splints with the aid of power. The above fact itself would show that the respondents are not eligible to avail the benefit of the notification. 5. The adjudicating authority while uphold ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent. In fact, the department had raised the issue as early as in 2005 when demand for payment of duty was made against Subathira Match Industries. The said match industry filed W.P. No. 771/2005 before the Hon'ble High Court of Madras. The writ petition was disposed with a direction to the assessee to file an appeal before the appropriate authority. They filed an appeal before the Commissioner (Appeals) and vide Order-in-Appeal No. 56/2005 dated 28.4.2005, the Commissioner (Appeals) held that they are eligible for exemption as per Notification No.6/2002-CE dated 1.3.2002. Similar demands were raised against other units who were following the same process of bundling, labelling and packing duty paid dipped match splints. Thus, the issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as aware of the facts, the Show Cause Notice issued after two years alleging misplacement of file cannot sustain. The decision in the case of Ispat Industries Ltd. Vs. CCE, Raigad reported in 2006 (199) ELT 509 (Tri. Mum.) was relied to argue that extended period cannot be invoked merely because the assessee did not interpret the provisions of law in the way department sought to interpret. The decision of the Hon'ble Supreme Court in the case of Padmini Products Vs. Collector of Central Excise reported in 1989 (43) ELT 195 (SC) was relied to argue that mere failure or negligence on the part of the manufacturer either not to take out the license or not to pay the duty when there was scope for doubt, the extended period cannot be invoked. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd clarified as under:- "In the present case parts are manufactured by a manufacturer with the aid of power. Such parts manufactured with the aid of power are purchased by another manufacturer of footwear who used such parts for manufacture of foot wear without the aid of power. So long as the second manufacturer does not use any power, in or in relation to manufacture of foot wear either in his factory or in the factory of his job workers, it cannot be construed that power has been used in the manufacture of foot wear only because the raw materials bought and used by him had been manufactured with the aid of power. This case is squarely governed by Circular No.4/87 C.E. dated 19.6.87". 11. It is discussed by the Commissioner (Appeals) t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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