2003 (7) TMI 548 - AT - Central Excise

Summary

Issues: Liability to duty on N-Hexane and derived cixon, applicability of Rule 57F, jurisdiction of notice invoking provision of 11AC, duty payable on cixon, need for technical examination of cixon.

In this judgment by the Appellate Tribunal CESTAT, Mumbai, the issue at hand is the liability to duty on quantities of N-Hexane and derived cixon as confirmed by the Commissioner (Appeals) based on the Additional Commissioner's order. The appellant received cixon from Indian Petrochemicals Corporation, Vadodara, under Rule 57F, isolated N-hexane, and returned the cixon to IPCL after paying duty. The appellant argues that cixon was not specified as an input under Notification 21/99 and that duty was discharged by IPCL, hence no duty is payable. However, the Tribunal rejects these arguments, stating that cixon falls under a category excluded from being an input under Rule 57F, and duty payment is the responsibility of the manufacturer, not the supplier.

Regarding the jurisdiction of the notice invoking provision of 11AC, the Tribunal finds that the notice is not without jurisdiction as it does not invoke the extended period proviso under Rule 11A. The Tribunal clarifies that the mere reference to 11AC in conjunction with Rule 173Q does not imply the extended period was invoked. The Tribunal emphasizes that the duty liability rests with the manufacturer, and procedural infractions do not relieve the appellant from duty payment obligations.

Furthermore, the Tribunal addresses the argument that no duty should be levied on the quantities of cixon received and returned by the appellant. While the Additional Commissioner claimed the cixon and derived cixon were different, the Tribunal notes the lack of technical information to verify this assertion. Therefore, the Tribunal decides to remand the matter to the Additional Commissioner for further examination of the chemical structure and characteristics of the cixon received and returned to determine if duty liability exists for this product.

In conclusion, the Tribunal upholds the duty liability on N-Hexane, dismisses the arguments regarding the applicability of Rule 57F and jurisdiction of the notice invoking 11AC, and orders a technical examination of the cixon to ascertain the duty liability on the returned quantities. The matter is remanded to the Additional Commissioner for a decision based on the technical analysis of the cixon involved.