2000 (2) TMI 161 - AT - Central Excise

Summary

Issues:
1. Duty demand confirmation and penalty imposition under CE Rules and CE Act.
2. Interpretation of Notification No. 253/82 regarding the process of drying fabrics.
3. Consideration of Tribunal judgments in Adreena Industries and National Dyers cases.

Analysis:
1. The appeal stemmed from an order confirming duty demand of Rs. 32,900 under CE Rules and CE Act, 1944, along with confiscation of goods and imposition of fines and penalties. The appellants challenged this order, citing Tribunal judgments and seeking relief based on legal interpretations.

2. The appellants contended that they were printing cotton fabrics since 1986 and availed benefits under Notification No. 253/82 for the process. They argued that the use of power for hydro extraction after printing did not violate the Notification. The Tribunal considered the process of drying fabrics and whether it disqualified the Notification benefits. Referring to earlier judgments, it was established that hydro-extraction or drying with power did not constitute a manufacturing process under the Notification.

3. The Tribunal reviewed the judgments in the Adreena Industries and National Dyers cases, where it was held that squeezing water from fabrics using power did not hinder the Notification benefits. The Tribunal reiterated that such processes were not ancillary to manufacturing and, therefore, upheld the appellants' plea. Consequently, the impugned order confirming duty demand and penalties was set aside, and the appeal was allowed with consequential relief.