1983 (4) TMI 282 - AT - Central Excise

Summary

Issues Involved:
1. Excisability of Bagasse
2. Time-bar and Applicability of Rule 10A
3. Computation of Duty

Summary:

1. Excisability of Bagasse:
The primary issue was whether "bagasse," a by-product from sugar manufacturing, was excisable. The Tribunal determined that bagasse is a distinct product with a recognized trade name and utility, thus making it excisable. The Tribunal noted that bagasse results from the extraction of juice from sugarcane, a manufacturing activity involving power. The Tribunal distinguished this case from the Indian Aluminium Company case, where the waste did not have a distinct trade usage or identifiable name.

2. Time-bar and Applicability of Rule 10A:
The appellant contended that the demand was time-barred and that Rule 10A was wrongly invoked. The Tribunal found that the demand was not time-barred because the show cause notice was served on 20-4-1977, before the deletion of Rule 10A on 6-8-1977. The Tribunal held that Rule 10A was applicable as the proceedings were initiated before its deletion. The Tribunal also noted that the appellant did not show bagasse in the Classification List for the period in dispute, justifying the application of Rule 10A.

3. Computation of Duty:
The appellant argued that the duty computation was erroneous, both in terms of weight and rate. The Tribunal found merit in this argument, noting that the rate of Rs. 10 per quintal was based on a single transaction unrelated to the period in question. The Tribunal directed a reassessment of the duty at Rs. 5 per quintal, considering the water content in bagasse as indicated in the appellant's records. The Tribunal ordered that the reassessment be completed within two months, providing consequential relief accordingly.

Conclusion:
The appeal was dismissed on merits regarding the excisability of bagasse and the applicability of Rule 10A. However, the Tribunal directed a reassessment of the duty based on a rate of Rs. 5 per quintal and the exclusion of water content from the weight calculation.