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2023 (8) TMI 654

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....K Agrotech (P) Ltd., are engaged in the manufacture of edible refined oil and also clearing goods viz. acid oil, fatty acids, gums and waxes. Alleging that the appellants have indulged in clandestine clearance of said products to avoid payment of Central Excise duty, proceedings were initiated and show cause notices was issued to the appellants. The Adjudication Authority in the case of M/s Habib Agro Industries vide Order-in-Original No.13/JC/CX/2009 dated 03.04.2009 confirmed the demand with interest and imposed equal penalty for the period 01.04.2006 to 30.10.2007 and also confirmed the demand with interest and imposed penalty for the period from 01.11.2007 to 30.11.2008. 2. Further in the case of M/s M. K. Agrotech the Adjudicating Aut....

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....ludes salt; Explanation:- for the purpose of this clause goods includes any article, material or substance which is capable of being bought and sold for consideration and such goods shall be deemed to be marketable. 5. Commissioner (Appeals) held that in view of the amendment to the definition of excisable goods the appellants are not eligible for the benefit of Notification No.89/95-CE w.e.f. 01.05.2008. These will be excisable goods and chargeable to payment of excise duty and remanded the matter to the adjudicating authority to determine the duty and penalty for the period from 01.05.2008. 6. The Department accepted the findings of the Commissioner (Appeals) prior to 10.05.2008. Consequent to the finding as regards the period after 1....

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....e goods are not manufactured goods then the question of levy itself will not arise. It is contended that the product, in question, are unwanted/inevitable waste. The value realized by the appellants on such unintended waste by sale, itself is not a criteria to decide the excisability. The Hon'ble Supreme Court in CCE vs Indian Aluminium Company- 2006 (203) E.LT. 3 (S.C.) held zinc dross and flux skimming are not exigible to central excise duty. Relying on the earlier decisions in Union of India vs. Indian Aluminium Company Ltd. - 1995 (77) ELT 268 (S.C.) and CCE, Patna vs. Tata Iron & Steel Company Ltd. - 2004 (165) ELT. 386 (S.C.), the Apex court held that the dross and skimming arising during the course of manufacture of metal cannot ....

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.... noted the process is to obtain refined rice bran oil by removing these unwanted products along with spent earth, which when present makes the oil as crude refined oil. 9. After considering the above facts, the Larger Bench held that "Hence, we are of the considered view that the removal of unwanted materials resulting in products like gums, waxes and fatty acid with odour cannot be called as a process of manufacture of these gums, waxes and fatty acid with odour. The process of manufacture is for refined rice bran oil. As such, we note that these incidental products are nothing but waste arising during course of refining of rice bran oil and applying the ratio of Apex court judgment, as discussed above, these cannot be considered as manuf....

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.... period of dispute from December 2007 to 2009 and in the matter of Arihant Solvex Pvt. Ltd. (supra), show cause notice was issued for the period from 01.04.2010 to 31.12.2013 and in all those cases, it was categorically held that the by-products emerging during the manufacture of refined oil are completely unintentionally by-products. Hence, they do not classify the definition of manufactured excisable goods. Since refined oil was exempted goods during the relevant period, these by-products are entitled to be treated as exempted by virtue of Notification No.89/ 95-CE dated 18.05.1995. Learned Counsel for the appellant further submitted that the appellants are eligible for the benefit of Notification No.8/2003 dated 01.03.2003 since the appe....