1985 (9) TMI 188 - AT - Central Excise

Summary

Issues Involved:
1. Whether printing on duty-paid aluminium foils done by the appellants on job work basis attracts levy of Central Excise duty.
2. If not, whether the appellant is the manufacturer in respect of such printed foils.
3. Whether the appellant is eligible for concession of proforma credit procedure u/r 56A without following the prescribed procedure.
4. Eligibility for benefit of exemption under Notification No. 71/72-C.E., dated 17-3-1972.
5. Eligibility for benefit of exemption under Notification No. 155/72 dated 15-6-1972, with duty being collectable only on quantity in excess of 5 MT.
6. Whether the special excise duty should have been calculated at the rate of 5% and not at the rate of 10%.
7. Legality and justification of imposition of penalty and redemption fine in respect of confiscated goods and confiscation of land, building, plant, machinery, and materials.

Summary:

1. Levy of Central Excise Duty on Printed Aluminium Foils:
The Tribunal held that printing on duty-paid aluminium foils does not constitute manufacture or a process of manufacture within the meaning of Section 2(f) of the Central Excises and Salt Act, 1944. The Tribunal emphasized that duty cannot be levied again on aluminium foils that have already discharged duty liability at the initial stage. The Tribunal relied on the Supreme Court decision in Collector of Customs and Central Excise & Another v. Oriental Timber Industries [1985 (20) E.L.T. 202 SC], which stated that duty is leviable only once on the product.

2. Manufacturer Status of Appellant:
The Tribunal did not find it necessary to determine whether the appellant is the manufacturer since it was concluded that duty is not leviable again on printed aluminium foils.

3. Concession of Proforma Credit Procedure u/r 56A:
The Tribunal did not address this issue in detail as the primary contention regarding the non-levy of duty on printed foils was upheld.

4. Exemption under Notification No. 71/72-C.E.:
The Tribunal did not find it necessary to decide on the eligibility for exemption under Notification No. 71/72-C.E. as the primary issue of non-levy of duty was upheld.

5. Exemption under Notification No. 155/72:
Similar to the above, the Tribunal did not find it necessary to address the eligibility for exemption under Notification No. 155/72 due to the primary ruling on non-levy of duty.

6. Calculation of Special Excise Duty:
The Tribunal noted that the special excise duty should have been calculated at the rate of 5% and not at the rate of 10%, as stated by the respondent's representative.

7. Imposition of Penalty and Redemption Fine:
The Tribunal set aside the demand of duty, penalty, and redemption fine, holding that the appellants could not be called upon to pay duty on the job work of printing on duty-paid aluminium foils. Consequently, the imposition of penalty, confiscation, and redemption fine were also set aside.

Separate Judgment by H.R. Syiem, Member (T):
H.R. Syiem, Member (T), concurred with the decision, emphasizing that once duty has been recovered on an article, it cannot be recovered again. He reiterated that the aluminium foil, having paid duty once, cannot be subjected to the same duty a second time, even if it undergoes changes such as printing.