9911796707
TMI Blog1997 (5) TMI 233X X X X Extracts X X X X X X X X Extracts X X X X ..... ssification under sub-heading 3820.00 of the Central Excise Tariff as anti-freezing preparations and also held that this product is not eligible for the benefit of Small Scale Industries Notification No. 175/86-C.E., dated 28-2-1986 and 1/93-C.E., dated 1-3-1993. The demand of duty was confirmed on the engine coolant for a period of 5 years from the date of issue of show cause notice. 4. In respect of the goods taken into possession redemption fine of Rs. 1,94,700.00 was imposed. A penalty of Rs. 2 lakhs was also imposed on the appellant under Rule 173Q of Central Excise Rules, 1944. 5. Brief facts of the case are that the factory of the appellant was visited by the officers of Central Excise on 9-8-1994 and it was found that appellants were engaged in manufacture of Nulon branded Polytetraflourroethylene (hereinafter mention as PTFE) lubricating oil additives, PTFE grease and coolant and they are not registered with the Central Excise Department. It was found that the appellant were filing a declaration under Rule 174 of Central Excise Rules, 1944 since 1990 and claiming exemption under Notification No. 120/84, dated 11-5-1984. In the declaration the appellant declared followi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tives for mineral oil. 11. He relied upon the decision of Hon ble Supreme Court in the case of Siddheswarian Cotton Mills v. Union of India reported in 1989 (39) E.L.T. 498 and submitted that the Commissioner has classified the goods vis. Nulon Lubricating Oil under Item 3811.00 as prepared additive for mineral oils. His ground is that Nulon Lubricating Oil is added to the ordinary Lubricating Oil and therefore it is an additive. The Commissioner says that it falls in the category of `other prepared additives occurring in 3811.00 of the Tariff. 12. He submitted that Item 3811.00 of the tariff provides as under : Anti knock preparations, oxidation inhibitors, gum inhibitors, viscosity improvers, anti-corrosive preparations and other prepared additives for mineral oils (including gasoline) or for other liquids used for the same purposes as mineral oils . 13. These preparations listed in this tariff have common features, that is to say, they form a `genus . The `genus is that they are unifunctional. Their functions are to prevent knocking or to prevent oxidation or to improve viscosity etc. Here we come to the principle of interpretation called Ejusdem Generis. The principl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed upon the judgment of Calcutta High Court in the case of Collector of Central Excise v. ESBI Transmission Pvt. Ltd. reported in 1997 (91) E.L.T. 292. 14. Regarding invoking the extended period in respect of Collector, he submits that the respondent were aware of the manufacturing of this product as the appellant filed necessary declarations time to time and the adjudicating authority accepted the plea of time bar caused by the appellant in respect of other products. 15. Shri A.K. Madan, SDR appearing on behalf of the respondents submitted that the appellant admitted the classification in respect of coolant as purposed by the respondents and the appellant has not declared the fact regarding manufacture of coolant to the respondents. 16. In respect of classification of engine treatment oils and differential gear treatment oil, he submits that these oils are used with lubricating oil and not as lubricant. These products are additive to a lubricating oil. He relied upon the description of the product as mentioned on the packing and submits that these products are to be added to the engine oil and gear oil already present in the engine and gear box of a motor vehicle. A similar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s for engine oil. 20. The above mentioned facts shows that products are not used as lubricating oils but added to lubricating oil as additives. 21. The process of manufacturing of the products in dispute is that imported PTFE is added/blended and mixed with mineral lubricating oil. Therefore, the products are not petroleum oils and oils obtained from bituminous as described under Heading 2710 of the Tariff. 22. Entry sub-heading 3811.00 of the Tariff reads as under : Anti knock preparation, oxidation inhibitors, gum inhibitors, viscosity improvers, anti-corrosive preparation and other prepared additives for mineral oils or for other liquids used for the same purpose as mineral oil. 23. This entry specifically includes other prepared additives and the description of the product given on the tin of the product is the latest innovation in lubrication technology with ultra fine activated PTFE and special additives. The products are used additives to the lubricating oils and we also find that the appellant themselves described their product as additive, hence is covered under this entry. The Notification No. 120/84, dated 11-5-1984 does not cover the items covered under sub-he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re is dispute regarding the valuation of goods and also in respect of quantity. The Commissioner Central Excise accepted the plea of the appellant that the respondent has taken the list price in valuating the goods while taking into possession which includes the admissible discount also. He directed the Asstt. Commissioner to determine the value of goods, which is to be subjected to duty at the appropriate rate during the relevant period after giving abatement to the elements like discount etc. When the value and quantity of goods taken into possession is disputed and regarding valuation Asstt. Commissioner is directed to determine the value. The appropriation of cash security is not sustainable. Therefore, we set aside the impugned order in respect of appropriation of cash security and the matter is remanded to the jurisdictional Commissioner. The jurisdictional Commissioner will pass appropriate order after calculating the value and quantity of the goods seized after giving hearing to the appellants. In respect of penalty, we find that appellants were filing declaration in respect of their products engine, gear box and differential treatment oils and in the impugned order the C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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