TMI Blog2004 (1) TMI 89X X X X Extracts X X X X X X X X Extracts X X X X ..... de required varies in the final design produced on the fabrics. According to the petitioners, printing paste is not a marketable commodity but tailor made item to suit the requirements of the mill, fabric design and the machine on which it has to be used to fix the print on the fabric. Only the individual mill can use the printing paste prepared by the printing master. 3.The Tariff Act came into force with effect from 28th February, 1986. By virtue of Trade Notice No. 48/86, dated 14th July, 1986, the Collectorate clarified that the Chapter Note 6 would apply only to conversion of unformulated/unstandardised or unprepared forms into formulated, standardised or prepared forms ready for use and that mere re-packing or re-labelling of duty paid dyes would not amount to 'manufacture' as no new product emerges. Similarly, the addition to various ingredients as set out therein or mixing of two or more formulated standardised and prepared dyes undertaking in the preparation of dye bath for dying and printing purposes would not amount to 'manufacture' as these processes were basically in relation to use of such formulated, standardised and prepared form. 4.By order dated 28th May, 1992 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter dated 10th February, 1993 replied to the aforesaid show cause notice and, specifically, mentioned therein that, vide order No. 2/93, dated 21st April, 1993 issued by the Board in exercise of powers conferred upon it; under Section 35B of the Act, it was, inter alia, clarified that preparation of printing paste prepared from formulated, standardised or prepared dyes by simple mixing with other material shall not amount to 'manufacture', as such it shall not be c1assifiable under Chapter sub-heading 3204.29 of the Tariff Act. 8.The petitioners were granted personal hearing by respondent No. 3 on 23rd June, 1993 and 16th March, 1994. The petitioners specifically relied upon Order No. 2/93, dated 21st April, 1993 issued by the Board in respect of their contentions. 9.According to the petitioners, printing paste consists of different essential ingredients having some common properties and some different. Those properties are mixed depending on the requirement at the time of use thereof. Each ingredient has particular role to play in printing, details of which are not necessary for the present purpose. Thus, according to the petitioners, for the following reasons printing paste a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g factors in order to define dutiability of any product under Central Excise Law is unsustainable in law in view of the judgment of the Apex Court in the case of Collector of Central Excise v. Ambalal Sarabhai Enterprises, 1989 (43) E.L.T. 214 (S.C.) and Bhor Industries Ltd. v. Collector of Central Excise, 1989 (40) E.L.T. 280 (S.C.). The learned Counsel for the petitioners thus contends that the impugned order is liable to be quashed and set aside. Per contra : 13.Mr. A.J. Rana, learned Senior Counsel for the respondents tried to support the impugned order and contended that no case as argued before this Court was made out by the petitioners in their reply to the show cause notices nor it has pleaded that the printing paste was prepared from formulated, standardised and prepared dyes with simple mixture with other materials. He, thus, submits that it is not open for the petitioners to contend that the printing paste prepared by them does not amount to 'manufacture' and, as such, not classifiable under Chapter sub-heading 3204.29 of the Tariff Act. He further submitted that the order No. 2/93, dated 21st April, 1993 issued by the Board is of no assistance to the petitioners in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the petitioners was on the Revenue. He further submitted that in view of the judgment of the Apex Court in the case of Bhor Industries Ltd. (supra) liability to pay excise duty arises only when manufacture of goods is established coupled with the fact that what was manufactured was marketable or capable of being marketed. According to him the marketability is an essential ingredient in order to be dutiable under the Schedule to the Tariff Act. 16.Having considered the rival submissions at length, the controversy lies in a very narrow compass which can be adjudicated upon the text of the show cause notices itself. The show cause notice dated 2nd November, 1992 incorporated at Exh. 'E' issued by respondent No. 3 specifically, states, "for the purposes of printing of fabric the petitioners require "printing paste", and the assessee bring duty paid colour from market and mix it up with other material such as chemicals and kerosene. The mixing giving rise to the substance known as "printing paste" is classifiable under Chapter sub-heading 3204.29 of the Tariff Act". The second show cause notice dated 4th February, 1993 also incorporates same averments. When the show cause noti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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