1999 (11) TMI 496 - AT - Central Excise

Summary

Issues:
Eligibility for small-scale exemption of castings manufactured by M/s. Mahavir Iron Foundry under Notification 1/93.

Analysis:

Issue 1: Eligibility for small-scale exemption under Notification 1/93
The Commissioner (Appeals) held that the respondents were eligible for exemption under Notification 1/93. The Commissioner relied on Board Circular No. 71/71/94, which clarified that castings with brand names, when made to order for a specific manufacturer and sold for their own use, would still qualify for the exemption. The Commissioner found that the appellants' case aligned with this clarification, which is binding on Central Excise authorities. Therefore, the Commissioner concluded that the appellants were not liable for duty payment as they were exempted under Notification 1/93. The goods were deemed not liable for seizure based on this exemption.

Issue 2: Challenge to the Commissioner (Appeals) order
The order of the Commissioner (Appeals) was challenged on the grounds that the castings for pipes and fittings were not intended for further manufacturing of other goods, thus not falling under the purview of the Board's Circular. The challenging party argued that no evidence was presented to prove that the goods were not traded by the actual purchaser, rendering the benefit of the Circular inapplicable to the castings. However, the respondent's counsel countered these arguments by referring to an order in adjudication which confirmed that the castings were manufactured as per the design and specifications of the respective buyers for further manufacture of diesel engines and machinery. The counsel highlighted that the Circular explicitly allowed for exemption when castings were made to order and sold to the manufacturer for their own use, emphasizing that the brand names on the castings belonged to the purchasers.

In conclusion, the Tribunal found that the castings were specifically made for further manufacturing purposes as per the design and specifications of the buyers, and the brand names on the castings belonged to the purchasers themselves. The Tribunal rejected the grounds of appeal, stating that the findings by the Commissioner (Appeals) were supported by evidence. Therefore, the appeals were deemed to lack merit and were consequently rejected.