2014 (2) TMI 638 - AT - Central Excise

Manufacture - Packing from loose receipt in unit boxes - Held that - Appellants have clearly admitted that in respect of shoes which are received in loose form and which are re-packed in cardboard boxes wherein details such as brand name, MRP, size of the shoes, colour of the shoes, etc. are affixed, they are liable to pay excise duty - Therefore, bulk of the demands confirmed in the impugned orders have been admitted to by the appellants and are not disputed. They are disputing the liability only in respect of shoes received in pre-packed form i.e. in card board boxes where the MRP is affixed and the appellant undertakes affixing of stickers on the shoes indicating bar codes, MRP and logo of the appellant on the bottom of the sole. However, in the statements recorded under the provisions of the Central Excise Act, the appellants have clearly admitted that they have no evidence in respect of this claim. Further, it is also an admitted fact that opportunity was given to them by the adjudicating authority to lead evidence about the receipt of shoes in pre-packed form; however, the appellants were not able to lead any evidence in spite of sufficient time being granted and the appellants admitted that they have no evidence in this regard. Therefore, the claim of the appellant that they had received about 10% to 15% of the shoes in pre-packed form from the karigars is only a mere claim without any supporting evidence. In the absence of any supporting evidence, such a claim cannot be entertained and, therefore, the adjudicating authority was right in concluding that the activities undertaken by the appellants amounted to manufacture as defined in Section 2(f) (iii) of the Central Excise Act, 1944 read with Third Schedule thereof - Following decision of RAFIQUE MALLICK Versus COMMISSIONER OF CENTRAL EXCISE, MUMBAI-I 2005 (6) TMI 466 - CESTAT, MUMBAI - Decided against assessee.

Summary

Issues:
- Appeal against Orders-in-Original regarding excise duty liability on footwear manufacturing activity.

Analysis:
1. Background: The case involved two appeals against Orders-in-Original passed by the Commissioner of Central Excise, Mumbai - I, concerning the excise duty liability on the manufacturing activity related to footwear.

2. Appellants' Activity: The appellants, M/s. Vira Shoes and M/s. Footnook, were accused of receiving footwear in loose form and repackaging them with various labels and stickers, ultimately leading to the imposition of excise duty liability on them.

3. Contentions: The appellants admitted liability for repackaged shoes with specific labels but disputed the duty liability for shoes received in pre-packed form, arguing that affixing bar codes, MRP, and logos on such shoes did not amount to manufacturing. They relied on precedents and rulings to support their stance.

4. Revenue's Position: The Revenue argued that the appellants' claims lacked evidence, as statements and submissions did not prove the receipt of pre-packed shoes. The Revenue highlighted discrepancies in the appellants' statements and emphasized the absence of proof supporting their claims.

5. Tribunal's Decision: The Tribunal examined both sides' arguments and found that the appellants failed to provide evidence supporting their claims of receiving pre-packed shoes. As a result, the Tribunal upheld the duty demands, considering the activity as manufacturing under the Central Excise Act, 1944.

6. Conclusion: The Tribunal dismissed the appeals, stating that the appellants' unsubstantiated claims regarding receiving pre-packed shoes did not hold merit. The lack of evidence led to the confirmation of duty demands, as the activity undertaken by the appellants was deemed as manufacturing under the relevant legal provisions.

This detailed analysis outlines the key aspects of the legal judgment, including the arguments presented by both parties, the Tribunal's assessment, and the ultimate decision reached regarding the excise duty liability on the footwear manufacturing activity.