9911796707
TMI Blog1998 (2) TMI 226X X X X Extracts X X X X X X X X Extracts X X X X ..... o to Section 11A and imposed penalty of Rs. 10,000/- on the appellants after holding that they are not eligible for the benefit of Notification No. 230/86, dated 3-4-1986 for the clearance of certain Industrial Flavour and Fragrance falling under sub-heading 3302.00 which they had claimed to have been manufactured without aid of power but which was held to have been manufactured with the aid of power. 2. It is not disputed that the only use of power is to operate certain laboratory equipments to test both quality of the raw materials received and the end product produced. The equipment in question used for such testing is as follows :- (a) Spectrometer (b) P.H. Meter (c) Vacuum Pump (d) Distillation apparatus (e) Water purifier ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e cited the decision in 1986 (24) E.L.T. 173 regarding the need to consider the quantum of power consumption in such cases. (iv) He further stated that w.e.f. 1-1-1989 they had removed this equipment from their factory and informed the department accordingly. This showed that these tests were not necessary to be conducted and therefore were not an integral part of the process of manufacture. (v) The ld. Advocate stressed that the entire demand was time barred as the extended period under proviso to Section 11A was not applicable because they were operating under the bona fide belief that the end product was exempt under the said notification whereas the decision of Apex Court in 1991 (55) E.L.T. 444 was passed only on 17-9-1991 and coul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts. He also argued that despite the first Order-in-Original dated 30-11-1988 the assessee still resisted to take out the licence in complying with thereof. 6. We have considered the arguments of both the sides. We find that since the Notification No. 230/86 gives us the term made and since this word is not defined in the Central Excise Act Rules the identical word manufacture , already defined therein would be applied to interpret the said notification. In this connection, it was seen that vide 1995 (77) E.L.T. 302, the Hon ble Tribunal had held that the words and phrases used in manufacture encompasses all processes directly related to actual production and not limited only to process of production. The test here was that any such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exemption contained in Notification No. 230/86 ibid would not be available to the appellants in this case. 10. However, we agree with their argument on the non-availability of the extended period under proviso to Section 11A. We find that it is an undisputed fact that the same Collectorate had issued an earlier SCN dated 7-6-1988 covering the period of operations from 1983-84 to 1987-88, on the same set of facts as is involved in the present issue. Therefore, it would be difficult to conclude that the department was not aware of this issue as far back as 7-6-1988 or even earlier and since the present SCN covers the period from 1-1-1988 to 31-12-1988 it would be difficult to hold any suppression of facts from the department with an intent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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