2005 (12) TMI 389 - AT - Central Excise

Summary

Issues:
Appeal against order-in-appeal denying benefit of Notification No. 276/67 on the ground of inputs received without duty payment not used in chemical formulation manufacturing.

Detailed Analysis:

1. Issue of Denial of Benefit of Notification No. 276/67:
The appeal was filed against the order-in-appeal by the Commissioner (Appeals) confirming the demand and denying the benefit of Notification No. 276/67. The reason cited was that inputs received without payment of duty were not utilized in the manufacture of chemical formulation. The Tribunal noted that the appellants were manufacturing Rubber solution from the inputs received without duty payment. The matter was sent back to the adjudicating authority for retesting the samples. However, the Chemical Examiner reported that due to the deterioration of the 17-year-old sample, it was impossible to determine its original nature and composition.

2. Opinion of Indian Institute of Technology, Delhi:
The appellant presented an opinion from the Indian Institute of Technology, Delhi, stating that Rubber solution qualifies as a Chemical Solution. Additionally, the appellants provided copies of invoices demonstrating that they marketed the product as a chemical solution for industrial purposes. They also submitted a copy of the show cause notice indicating that the seized goods were chemical formulations for industrial use. Considering these pieces of evidence, the Tribunal concluded that the appellants were indeed manufacturing chemical formulations from inputs received without duty payment.

3. Entitlement to Benefit of Notification No. 276/67:
Based on the evidence presented, including expert opinion and commercial documentation, the Tribunal ruled that the appellants were entitled to the benefit of Notification No. 276/67 dated 21-12-67. It was established that the final product manufactured by the appellants was a chemical formulation intended for industrial applications. Consequently, the impugned order denying the benefit of the notification was set aside, and the appeal was allowed in favor of the appellant.

In conclusion, the Tribunal overturned the order-in-appeal that had denied the benefit of a specific notification, emphasizing that the appellants were indeed engaged in the manufacture of chemical formulations using inputs received without duty payment, as supported by expert opinions and commercial evidence presented during the proceedings.