9911796707
TMI Blog1995 (10) TMI 165X X X X Extracts X X X X X X X X Extracts X X X X ..... osed penalty of Rs. 5,000/ under Rule 173Q of Central Excise Rules, 1944. He has held that processed (dyed and bleached) cotton fabrics in which hydro-extraction machine working with the aid of power was used for extraction of water are liable for duty under Tariff Item 19(i)(b) of the erstwhile Tariff. He has also held that the assessee was required to have taken out Central Excise licence for the manufacturing process and that they were required to have filed classification list, assess and clear the same on payment of duty under proper gate pass. He has found the appellants having committed contravention of various rules of the Central Excise, as alleged in the show cause notice issued to them. The appellants had been found to have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... they are not liable to pay any Central Excise duty. They submitted that this fact had been verified by visiting officers, as is evident from panchnama drawn on 27-6-1984 at the time of the visit. They also cited a case adjudicated by the Assistant Collector, Central Excise MOD-III, New Delhi in their support. They had submitted that Notification No. 253/82 in its proviso 2, the word `any process , should have the meaning of any finishing process and not the process of extraction of water by squeezing the fabrics and had pleaded that they are squarely covered by Notification No. 137/77 and Notification No. 130/82. They had also relied on a decision of the Government of India in the case of M/s. Devkinandan Damani and also CEGAT Order No. 418 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in his statement. He has held that such drying was part of the process of bleaching and dyeing and even though power may not have been used upto that stage, the use of power in the process of hydro-extraction can make the process of dyeing and bleaching carried out by the appellant one with the use of power since the process of hydro-extraction would at least be a process incidental and ancillary to the completion of manufactured product i.e. bleaching and dyed product. Hence, he has held that the benefit of the Notification Nos. 137/77 and 130/82 is not available to the party and as a consequence the Notification No. 80/86 as amended by Notification No. 292/79 and Notification No. 253/82, dated 8-11-1982 being very specific is also not a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of manufacture. The Tribunal rejected this contention of the assessee by referring to the judgment of Hon ble Supreme Court rendered in the case of Collector of Central Excise v. Rajasthan State Chemical Works as reported in 1991 (55) E.L.T. 444, wherein it has been clearly held that any activity or operation which is an essential requirement and is so integrally relied to the further operation for the net result, would also be a process in or in relation to manufacture. The Learned Advocate referring to the judgment of Amar Processors distinguished the facts on the ground that in the present case the process of hydro-extraction was being done after the process of bleaching and dyeing was done with hand-operated machine and, therefore, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion before us to be determined. In the Larger Bench s case as stated by the Learned Advocate, the Larger Bench has overruled the judgment earlier rendered in the case of Moti Dye Works by the Tribunal and has held that the manufacture of dyed yarn is completed before extraction of water and drying the cotton fabrics does not constitute nor is a process ancillary to the process of manufacture, in view of the fact that the final goods had already come into existence even before the extraction of water. The Tribunal has held that the manufacture being completed and the product as already known in the market having come into existence as such, therefore, mere extraction of water is not an activity incidental or ancillary to the process of comp ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
