9911796707
TMI Blog1997 (8) TMI 129X X X X Extracts X X X X X X X X Extracts X X X X ..... visit of the officers to the factory of the appellants on 9th October, 1987, it was found that the assessees had manufactured C.I. Ingot moulds with steel bands falling under sub-heading 8354.00 of the Schedule to the Central Excise Tariff Act, 1985 and cleared them at nil rate of duty under Notification No. 208/83-C.E., dated 1-8-1983 as amended. It was found that steel bands are first manufactured according to specifications and drawings supplied by the customers and subsequently, the steel bands are used captively in the manufacture of C.I. ingot moulds with steel bands. The steel bands had not been declared as a manufactured product by the assessees in their classification lists nor they had paid duty on the steel bands cleared for cap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , would be entitled to deemed credit by virtue of various deemed credit orders issued by the Government of India right from April, 1986 onwards. 5. In reply, the learned DR draws our attention to the finding of the Additional Collector in which it has been held that the process adopted by the appellants has resulted in a transformation i.e. steel plates have become steel bands - a new commercial commodity has emerged as a result of the activities of the appellants and the steel bands are also made according to technical specifications, the purpose of the steel bands is different from steel plates. In other words, the steel bands are used to give support to cast iron ingot moulds. Therefore, the test of manufacture, according to the learne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g 7308.90 of the Schedule to the Central Excise Tariff Act, 1985. 7. As for the applicability of extended period of limitation (in the first case, the entire period is beyond six months while in the second case, part of the demand is barred by limitation) the plea that assessees were under the bona fide belief that the activities carried out by them did not constitute manufacture, is not acceptable. The judgment referred by the learned Counsel namely the Tribunal s judgment in the case of Aruna Industries v. Collector of Central Excise, Guntur - 1986 (25) E.L.T. 580 (Tribunal) is distinguishable on facts. In that case, the steel structurals fabricated from iron and steel products by cutting, drilling holes and welding were held not to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... antum of relief, we remand the matter to the Adjudicating authority for quantifying the demand in the light of the principles set out in the Tribunal s order in the case of Chamundi Steels Re-rolling Mills v. Collector of Central Excise, Bangalore - 1996 (81) E.L.T. 563 (Tribunal) = 1994 (3) RLT 855 and thereafter, suitably modify the demand and grant consequential relief, if available, to the appellants in accordance with law. 9. In Appeal No. E/2493/89-B1, a penalty of Rs. 15,000/- has been imposed by the Adjudicating authority. However, having regard to the above facts and circumstances of the case we are of the view that the penalty requires to be reduced and accordingly reduce it to Rs. 1,000/-. Both the appeals are disposed of in th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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