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TMI Blog1988 (2) TMI 348X X X X Extracts X X X X X X X X Extracts X X X X ..... ntral Excise, Kanpur. By this order, the Collector (Appeals) held that the process of extraction of sandalwood oil from sandalwood undertaken by the appellants amounted to a process of manufacture, that the resultant sandalwood oil was a new product different from the raw material sandalwood and that, therefore, the benefit of Central Excise Notification No. 119/75 dated 30-4-1975 was not admissible to the appellants. The Collector (Appeals) also found that the period of limitation applicable to the demand of duty was five years because of the suppression of material facts on the part of the appellants. In the result, he upheld the Assistant Collector s order except for a direction that the exact amount of duty should be recalculated. 2. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estment on Plant and Mahinery did not exceed Rs. 10,00,000/-, they were eligible for exemption under Notification No. 176/77, dated 18-6-1977 and that they were outside licensing control of Central Excise authorities. In response to this letter, the Superintendent of Central Excise wrote to the appellants on 28-9-1977 directing them to apply for Central Excise licence and to complete other formalities. They were further directed not to clear any goods for export or for home consumption out of their factory till the grant of permission by the Superintendent and further to furnish particulars of the goods manufactured and cleared from 18-6-1977. On 14-10-1977, the appellants submitted the required documents under protest. Along with this lett ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ond on 26-3-1980 covering the period from 22-6-1977 to 30-3-1978 invoking Central Excise Rule 10 did not allege any suppression of material facts on the part of the appellants nor did they propose any personal penalty. He further submitted that the understanding prevalent at the material time was that for Item 68 goods manufactured on job charge basis, duty was payable only on the job charges and not also on the value of the raw materials furnished by the suppliers to the job workers. In the circumstances, no mala fide intent to evade duty or suppression of facts could be attributed to the appellants. Further, the assessment returns in Form RT 12 had also been approved by the department and the gate passes had also disclosed the aspect of j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ants. We have earlier noted the sequence of events and the correspondence exchanged between the appellants and the department. As early as on 4-8-1977 the appellants had made known to the department the fact that they were producing sandalwood oil not only on their own account but also for others on job charge basis from the raw material supplied by them and that the value of sandalwood oil produced on job charges basis was determined in accordance with Notification No. 119/75 dated 30-4-1975. This notification stated that the value on which duty would be payable in such cases would be the job charges collected by the jober. This position had also been reiterated in further correspondence. Then we have two classification lists which had bee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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