2008 (2) TMI 701 - AT - Central Excise

Summary

Issues:
1. Whether the activities carried out by the appellant amount to 'manufacture' under Section 2(f) of the law.
2. Whether the appellant is entitled to exemption under Notification No. 8/2001-C.E.
3. Whether the extended period of limitation can be applied in this case.

Analysis:

1. The primary issue in this case was whether the activities conducted by the appellant constituted 'manufacture' as defined under Section 2(f) of the law. The Department argued that the appellant's processes fell under the definition of 'manufacture,' specifically citing Section 2(f)(iii), which includes activities like packing, labeling, and branding. The Commissioner found that the goods received by the appellant required quality control, branding, and packing before they could be marketed, thus meeting the criteria for 'manufacture' under the law. Although there was a question regarding the goods falling under a specific chapter heading, the Tribunal did not delve into that aspect.

2. The second issue revolved around the appellant's eligibility for exemption under Notification No. 8/2001-C.E. The notification provided concessions to Small Scale Industry (SSI) units, and it was undisputed that the appellant was registered as an SSI unit. The Department contended that the appellant using a specific brand name would disqualify them from the exemption. However, the Tribunal examined the trademark registration details and found that the appellant was entitled to the exemption as the brand name used fell within the permissible criteria, thereby relieving the appellant from paying excise duty.

3. The final issue addressed whether the extended period of limitation could be applied in this case. The appellant argued that due to the seizure of goods, the Department was aware of all relevant facts, and there was no suppression on their part. The Tribunal agreed with the appellant, finding merit in their argument that the extended limitation period should not be enforced. Consequently, the Tribunal granted a full waiver to the appellant, dispensing with the pre-deposit requirement and staying the recovery of the duty amount.

In conclusion, the Tribunal ruled in favor of the appellant on all counts, finding that the appellant's activities did not amount to 'manufacture,' confirming their entitlement to exemption under the relevant notification, and rejecting the application of the extended limitation period. The appellant was granted a full waiver, and the recovery of the duty amount was stayed.