2016 (9) TMI 1015 - AT - Central Excise

Manufacture - whether the appellant-assessee is the manufacturer of PET bottle - appellant-assessee procures pre-forms required to manufacture of PET bottles and supply the same to job worker who converts the pre-forms into PET bottles and there upon fills the same with fruit pulp which is an exempted product - Held that - the appellant-assessee cannot be considered as a manufacturer of PET bottle for the simple reason that they have not undertaken any such process. In other words, if they supply pre-form to the job worker to be converted into PET bottles and for the further use in packing the fruit pulp, the same cannot make the appellant -assessee as a manufacturer. The admitted fact of the case is the job worker is an independent legal entity and irrespective of ownership of pre-form or the PET bottle the appellant-assessee having been not involved in any process of manufacture cannot be held as a manufacturer for excise duty purposes. Notification No. 10/96-CE dated 23.07.1996 - captive consumption - eligibility for exemption - Held that - it is found that the fruit pulp cannot be marketed without being packed in the bottle. The packed fruit pulp is the product subjected to excise levy. In the manufacture of such packed fruit pulp, PET bottle is apparently consumed. By applying to the ratio of decision of the Tribunal in the case of Mihijam Vanaspati Limited vs. CCE, Jamshedpur 2001 (1) TMI 152 - CEGAT, KOLKATA and also in Rama Phosphate Ltd. vs. CCE, Indore 2002 (12) TMI 291 - CEGAT, NEW DELHI wherein Tribunal held that when the tin containers manufactured by the appellant are captively used for packing vanaspati within the factory, the exemption is available to such tin container, the exemption is available to appellant-assessee. - Decided in favour of assessee

Summary

Issues:
1. Tax liability of the appellant -assessee on PET bottles manufactured by a job worker.
2. Whether the appellant-assessee can be considered the 'manufacturer' of PET bottles.
3. Eligibility of exemption for PET bottles under Notification No. 10/96-CE.
4. Appeal by the Revenue against granting exemption for captive consumption.
5. Change in the cause title due to the appellant-assessee changing their name to Hershey India Private Limited.

Analysis:

1. Tax Liability on PET Bottles: The case involves the tax liability of the appellant -assessee on PET bottles manufactured by a job worker for filling exempted fruit beverage. The Revenue initiated proceedings to demand Central Excise duty and penalties, leading to a confirmed demand of ?61,22,732 for a specific period.

2. Manufacturer of PET Bottles: The primary issue addressed was whether the appellant-assessee could be considered the 'manufacturer' of PET bottles. The Tribunal found that the appellant-assessee supplying pre-forms to a job worker for the conversion into PET bottles did not qualify them as a manufacturer. Citing legal precedents, including decisions by the Hon'ble Supreme Court and various Tribunals, the Tribunal concluded that the appellant-assessee's lack of involvement in the manufacturing process absolved them of manufacturer status for excise duty purposes.

3. Exemption under Notification No. 10/96-CE: The Tribunal also examined the eligibility of exemption for PET bottles under Notification No. 10/96-CE. Contrary to the original authority's rejection, the Tribunal ruled in favor of the appellant-assessee. It determined that PET bottles were consumed in the manufacture of the final product, a fruit pulp drink packed in the bottles, making them eligible for the exemption. The Tribunal cited relevant case laws to support this interpretation.

4. Revenue's Appeal Against Exemption: The Revenue's appeal contested the allowance of exemption for captive consumption under Notification No. 10/96-CE. However, based on the Tribunal's findings regarding the appellant-assessee's non-manufacturer status and eligibility for exemption, the Revenue's appeal was dismissed for lacking merit.

5. Change in Cause Title: Lastly, the Tribunal addressed the appellant-assessee's request for a change in the cause title due to a name change to Hershey India Private Limited. The Tribunal granted the requested change following the submission of relevant documentation.

In conclusion, the Tribunal allowed the appeal filed by the appellant-assessee, rejecting the Revenue's appeal against granting exemption. The judgment provided a detailed analysis of the issues, emphasizing the legal interpretations and precedents that guided the decision-making process.