2004 (3) TMI 687 - AT - Central Excise

Summary

Issues involved:
1. Duty calculation on intermediate drugs used in the manufacture of exempted final products without payment of duty
2. Demand of duty on specific intermediate drugs for captive consumption
3. Calculation of duty amount, extended period of limitation, and imposability of penalty

Analysis:

Issue 1: Duty calculation on intermediate drugs
The appellants manufactured bulk drugs and intermediate drugs without paying duty, used in the manufacture of exempted final products. The duty exemption for final products did not extend to intermediate products, leading to a demand for duty on the intermediates by the department.

Issue 2: Demand of duty on specific intermediate drugs
Duty was demanded on Pyrantal Citrate, Disodium Pamoate, and Epoxide produced and cleared for captive consumption during the relevant period, leading to the appeal against the same.

Issue 3: Calculation of duty amount, extended period of limitation, and penalty
The appellants contested the duty calculation, extended limitation period invokability, and the imposability of penalty. The argument included the rescission of a notification affecting duty liability, the marketability of specific products, and the disclosure of intermediate products in the classification list.

The Tribunal accepted that duty demanded on Pyrantal Citrate and Epoxide for a specific period was time-barred and set aside the demand for Disodium Pamoate. However, extended limitation was upheld due to non-disclosure of intermediate products. The marketability of products was established, leading to upholding the duty demand for Pyrantal Citrate and Epoxide for a specific period. The penalty was reduced in light of the circumstances.

In conclusion, the appeal was partly allowed, with duty demands adjusted based on the Tribunal's findings and penalty reduced.