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TMI Blog1996 (11) TMI 173X X X X Extracts X X X X X X X X Extracts X X X X ..... btained any Central Excise Licence. They had also not filed any declaration as required under Rule 174A of the Central Excise Rules, 1944 (hereinafter referred to as the `Rules ). They had not maintained any statutory accounts of production and removal of the goods manufactured by them and had not followed any Central Excise Procedure and had not paid any central excise duty on the goods manufactured and removed. In the show cause notice dated 19-2-1985, M/s. Guru were called upon to show cause to the Collector of Central Excise, Baroda as to :- (1) Why the duty of excise at the appropriate leviable rate should not be recovered from them on the goods falling under Tariff Item 33C totally valued at Rs. 4,43,680/- (11,93,680 - 7,50,000) illicitly manufactured and removed by them during the financial year 1983-84 as mentioned in para 9 of the notice under the proviso to Sub-section (1) of Section 11A of the Central Excises and Salt Act, 1944, read with Rule 9(2) of Central Excise Rules, 1944. (2) Why penalty should not be imposed on them under Sub-rule (1) of Rule 173Q of the Central Excise Rules, 1944. The Collector of Central Excise, Vadodara in her adjudication Order dated 24 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th by the adjudicating authority in her Order-in-Original. He pleaded for the rejection of the appeal. 6. We have carefully considered the matter. The goods manufactured by M/s. Guru were Domestic Electrical Grinders in which either the electric motor was fitted in the grinder cabinet or the grinder cabinet with mechanism for fitting and operating the electric motor was supplied to the customers. In both cases, the grinder was an electrical appliance and was meant for working with electricity. It is not necessary for classification under Tariff Item 33C of the Tariff that the electric motor should invariably be supplied with the appliances if the appliances in common parlance can be described as an electrical appliance. The classification will not change on the ground that the appliance under consideration was supplied without motor. Tariff Item No. 33C during the relevant time reads as under :- Tariff Item 33C. - Domestic electrical appliances, not elsewhere specified. Explanation I. : Domestic electrical appliances means electrical appliances normally used in the household and similar appliances used in hotels, restaurants, hostels, officers, educational institutions, hos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on to the sale through the selling agents the grinders were sold direct to the customers in a complete condition having in-built electrical devices along with electric motors . He stated that their grinding mills were not capable of working without electric motors and they could not function without electric motors. The grinding mills which had a detachable electric motors with V Belt arrangement, for transmission of the motion were being supplied to the customers in a composite condition. He explained that the billing was done separately - one for grinding mills and the other for electric motors for the purpose of saving sales tax, though in fact the grinding mill was being manufactured and removed in composite condition; the arrangement was only to avoid sales tax on electric motors. In his further statement dated 28-8-1984, Shri Vijay Bhai Chunnilal Panchal, Partner explained that they sold fully manufactured grinders duly arranged with electric fittings, to their customers. It was stated the electrical fittings in the cabinet like wiring, switches, etc., are done by their workers (refer para-5 of the Order-in-Original). All the grinders were sold under the brand name `Navjiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the help of an electric motor. The electric motor was fixed on the specific demand made by a customer. In the case before us, there is nothing to show that the grinders could be operated manually. The goods were marketed under a brand name and most of the goods were marketed through their own agents. Electrical element was fitted in all the grinders (refer statement of the partner of M/s. Guru, dated 28-8-1984). In the case of Collector of Central Excise v. Alco Industries - 1991 (55) E.L.T. 184 (Madras), the matter before the High Court of Judicature at Madras related to the Wet Grinder in which the grinder as such had no electrical connection for operation by receiving electrical energy. The electrical motor was placed alongwith and provided with pulleys for rotating the grinders by means of V Belts. The High Court considered that by mere process of assembling the electric motor in the already existing grinder no commercially new product as such emerged by any manufacturing process. To our mind, there is no relevancy of these decisions to the specific facts before us in these proceedings. 11. In view of the facts specific to this case, we consider that the goods in ques ..... 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Rule 9(1), Rule 173B, Rule 173C, Rule 173G (2) read with Rule 52A, Rule 173G (4) read with Rule 53 of the Central Excise Rules, 1944 in as much as they engaged themselves in the manufacture of excisable goods falling under Tariff Item 33C without having applied for and obtained a licence in form L 4 for such manufacture as required, failed to determine their liability to duty on the said goods manufactured and removed by them without payment of duty leviable thereon as mentioned in para 9 above, failed to file classification list and price list failed to prepare and issued gate passes in the prescribed form for removal of said goods and further failed to maintain statutory accounts of production and removal of the goods manufactured by them which all acts of contravention on their part appear to constitute offences of the nature as described in clause (a), (b), (c) and (d) of Sub-Rule (1) of Rule 173Q of the Central Excise Rules, 1944 committed by them by reason of fraud, wilful mis-statements and suppression of facts with an intent to evade payment of duty." The matter had been discussed by the adjudicating authority in para 15 of her order. The matter was detected as a result ..... X X X X Extracts X X X X X X X X Extracts X X X X
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