1999 (5) TMI 402 - AT - Central Excise

Summary

Issues Involved:
1. Whether the appellants were liable to pay central excise duty for manufacturing brass products.
2. Whether the product "ravali" was subject to central excise duty.
3. Whether the product "pittal pat" was liable for central excise duty.
4. Quantification of duty on "pittal pat" and imposition of any penalty.

Detailed Analysis:
1. The issue of central excise duty liability arose when officers observed the appellants importing brass dross and ash, processing it into "ravali," and further converting it into brass ingots or "pittal pat." The revenue alleged that the appellants undertook manufacturing processes, leading to a show cause notice for duty evasion. The appellants contended they were only involved in physical processes and not manufacturing, disputing the duty liability.

2. The Tribunal analyzed the nature of the products produced by the appellants, distinguishing between "ravali" and "pittal pat." Referring to a previous judgment, the Tribunal held that "ravali" did not result in a new marketable commodity through processing, thus not attracting central excise duty liability. Consequently, the Tribunal ruled that no duty was payable on "ravali."

3. However, the Tribunal determined that the process of converting "ravali" into "pittal pat," involving the use of furnaces and molding, amounted to a manufacturing process. As "pittal pat" was a distinct product traded in the market, it was deemed liable for central excise duty. The Tribunal rejected the plea of limitation due to the appellants not disclosing this manufacturing activity to the authorities.

4. Regarding the quantification of duty on "pittal pat" and potential penalties, the Tribunal directed the concerned Commissioner of Central Excise to reexamine the invoices describing the goods as "pittal pat," "brass ingots," or "brass rods" for accurate duty calculation. The matter was remanded for re-adjudication to determine the duty on "pittal pat" and consider any penalty based on the specific descriptions in the invoices.

In conclusion, the Tribunal ruled in favor of the appellants regarding the duty liability on "ravali" but held that "pittal pat" was subject to central excise duty. The case was remanded for quantifying the duty on "pittal pat" based on the descriptions in the invoices and for potential penalty imposition.