TMI Blog1997 (4) TMI 95X X X X Extracts X X X X X X X X Extracts X X X X ..... o meet the demands of its customers. Therefore, it was drawing copper wires from duty paid copper rods in the factory and thereafter wanted to send the copper wires so drawn for further processing i.e. insulation with PVC compound to another factory. The company therefore sought permission for being allowed the facility under Rule 56B for movement of the bare copper wire so drawn without payment of duty to the other factory for insulation and then being brought back to their own factory for further processes. 3. The Collector of Central Excise by impugned order, after considering the Company's detailed arguments in its letter dated 27-8-1988 and after seeing the samples of copper wire and of winding wire, declined to give permission under Rule 56B of the Rules of 1944. The reasons given by the Collector for declining to grant permission were as follows : "The copper wire falls under Chapter 74 and winding wire under Chapter 85 of the C.E.T. According to Rule 9 of the Central Excise Rules 1944, no excisable goods can be removed whether for captive consumption or outside, for manufacture of any other commodity, without payment of duty. It is an admitted fact that copper wire as s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is classifiable under heading No. or sub-heading No., of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), as may be specified in the notification issued under sub-rule (1) of Rule 56A; (iii) is neither exempt from the whole of the duty excise leviable thereon nor is chargeable to nil rate of duty : Provided also that the Collector may, if he thinks fit instead of requiring payment of duty in respect of each separate consignment of goods removed from the place or premises specified in this behalf, or from a storeroom or warehouse duly approved, appointed or registered by him, keep with any person dealing in such goods an account-current of the duties payable thereon and such account shall be settled at intervals, not exceeding one month, and the account-holder shall periodically make deposit therein sufficient in the opinion of the Collector to cover the duty due on the goods intended to be removed from the place of production, curing, manufacture or storage. (1A) Where a person keeping an account-current under the third proviso to sub-rule (1) makes an application to the Collector for withdrawing an amount from such account-current, the Collector may, for reas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r manufactured or any premises appurtenant thereto, which may be specified by the Collector in this behalf. The idea is that the manufactured goods which are excisable shall not be taken out from the premises where they are to be kept and they can only be taken out after paying the excise duty. This Rule 9 was there initially. Thereafter it appears that some difficulty might have been felt by the manufacturers that all the goods excisable cannot be manufactured under one shed and it has to be taken out for further processing. Keeping this in view, Rule 56B appears to have been inserted whereby special procedure for removal of finished excisable goods or semi-finished goods for certain purposes has been provided. Rule 56B of the Rules of 1944 empowers the Collector that he may by special order and subject to such conditions as may be specified by the Collector, permit a manufacturer to remove excisable goods which are in the nature of semi-finished goods for carrying out certain manufacturing processes, or excisable goods for carrying out tests, to some other premises and to bring back such goods to the factory without payment of duty or to some other registered premises of his or t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istence and it appears that Rule 56B was later on amended and modified so as to facilitate the manufacturers to take out the excisable goods for further processing without paying duty. Therefore, both the provisions have to be read harmoniously and not in conflict with each other as the framers have done it consciously with the purpose and that purpose should not be frustrated by interpreting both these rules to be in conflict with each other. Hence, we read Rule 9 and Rule 56B of the Rules of 1944 harmoniously and Rule 56B enables the Collector to permit removal of goods, on the basis of facts available, out of factory premises to another factory or premises for further finishing processes and to bring them back to the original factory for further processing or for marketing therefrom. Therefore, we are of the opinion that the view taken by the Collector that Rule 9 imposes a total bar on him to grant permission under Rule 56B just because an intermediary item itself is a classified item for duty is not the correct approach. 6. In this connection our attention was invited to a decision of Allahabad High Court in the case of Lohia Machines Limited v. Union of India and Others - 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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