2006 (5) TMI 257 - AT - Central Excise

Summary

Issues:
Waiver of pre-deposit of duty and penalty in a case involving repacking of RBD palmoline oil into retail packs and labeling with a brand.

Analysis:
The case involved an application for waiver of pre-deposit of duty and penalty amounting to Rs. 2,20,752 arising from the order of the Commissioner of Central Excise (Appeals), Pune. The Deputy Commissioner had confirmed the demand and penalty against the appellants, arguing that the repacking of RBD palmoline oil into retail packs and labeling with a brand constituted "manufacture" as per Note 4 to Chapter 15 of the Central Excise Tariff Act, 1985.

Upon hearing both sides, the Tribunal found that the Commissioner (Appeals) had rightly distinguished a previous order in the Ammonia Supply Company case, where filling liquid ammonia into smaller cylinders was not considered as manufacture. In contrast, the present case involved labeling and repacking from tankers into retail packs, meeting the criteria of Note 4 to Chapter 15. As a result, the Tribunal concluded that no strong prima facie case for total waiver was established. The Tribunal directed a pre-deposit of Rs. 1,00,000 towards duty within eight weeks, after which the balance duty and penalty would be waived, and recovery stayed pending the appeal. Failure to comply would lead to vacation of stay and dismissal of the appeal without prior notice.

The Tribunal set a compliance reporting date of 26-6-2006 for the parties involved. The judgment was pronounced in court, with the order delivered by Jyoti Balasundaram, Vice-President.