9911796707
TMI Blog1989 (12) TMI 164X X X X Extracts X X X X X X X X Extracts X X X X ..... as being received by the respondent from traders in the market or from the manufacturers of hosiery goods and were returning the same to them after completing the required process. The respondent was paying duty at the rate of Rs. 10 per Kg. in terms of Notification No. 125/75-C.E., dated 12th May, 1975 on the presumption that base yarn had discharged duty liability before it was received for dyeing. A show-cause notice requiring the respondent to show cause to the Assistant Collector of Central Excise as to why Central Excise duty amounting to Rs. 4,300 at Rs. 24 per Kg. leviable on 180 Kgs. [as applicable to base yarn under Tariff Item 18(i) of the Central Excise Tariff] should not be demanded under Rule 9(2) of the Central Excise Rules, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... behalf of the revenue, it was contended that it was for the respondent to prove that the duty had been paid on the base yarn and if the appellant was paying the duty of Rs. 10 per kg. only under Notification relied upon and in the absence of proof of payment of duty, the base yarn, the orders of the lower authorities making the respondent liable to pay the duty were correctly passed. The Tribunal found that the respondent was not the manufacturer of base acrylic yarn. The work done by the respondent on the base yarn was by way of texturising the same. In respect of the same, the duty payable on the textured yarn produced out of base yarn is the duty for the time being leviable on the base yarn, if not already paid, plus Rs. 20 per kg. Unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the department to verify the fact of such payment and take action against the manufacturer if base duty had not been paid. Under the relevant Tariff Item, the duty, as mentioned before, was fixed as the duty for the time being leviable on the base yarn, if not already paid, plus Rs. 20 per kg. (reduced to Rs. 10 per kg. under the notification). The notification does not change the basic position so far as base duty is concerned from the aforesaid stand. The Tribunal held that the revenue was entitled to claim duty inclusive of the duty paid on base yarn only on proof that the duty on the base yarn had not been already paid, unless otherwise, in the normal course, the presumption inevitable, in view of the nature of the business, be that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tructive to refer to Rule 49 of the Central Excise Rules, 1944, which deals with duty chargeable only on the removal of the goods from the factory premises or from an approved place of storage. Reference was also made before the Tribunal and our attention was also drawn to the decision of the Delhi High Court in Sulekh Ram & Sons v. Union of India & Ors. [1978 E.L.T. (J 525)], whereunder Rule 9 of the Central Excise Rules, it was held by the Delhi High Court that under excise system, no goods can be removed from the place of manufacturer without first paying the excise duty, therefore, a purchaser can presume that goods are duty paid. It would be intolerable if the purchaser were required to ascertain whether excise duty had already been pa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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