9911796707
TMI Blog1999 (9) TMI 159X X X X Extracts X X X X X X X X Extracts X X X X ..... of 'Butachlor', the following three intermediate product come into existence. (i) Chloro Acetyl Chloride (ii) 2, 6 Diethyle Chloro Acetanilide (DECA) (iii) Chloro Methyl Butyl Ether (CMBE). 2.2. The Collector, Central Excise, in the impugned order dated 23-3-1993, confirmed the demand of duty amounting to Rs. 82,07,861/- in respect of products 'DECA' and 'CMBE' removed during the period from September, 1987 to June, 1989, imposed penalty of Rs. 30 lakhs and confiscated land, building, plant etc. with an option to redeem the said on payment of fine Rs. 5 lakhs, holding that - (i) In view of Note 1(a) to Chapter 29, the impugned goods are covered by Chapter 29 even if they are crude or contain impurities. (ii) They had submitted ex-factory cost of the impugned products which proved that these products were independent and identifiable products. (iii) It is evident from the statement dated 4-4-1991 of Shri Patadia that the intermediate products DECA and CMBE are not only isolated but they are also stored in the manner considered suitable for their intended use in the factory and it is possible to withdraw them as samples were drawn. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ronment, it gets evaporated and also decomposed into Butanol, Methyl ether and HCL Gas; that Methyl Ether and HCL create suffocation for human beings. He, further, submitted that their manufacturing system is such that the impugned goods are continuously generated and being used further while this manufacturing process is going on, that they do not have means to segregate and store these goods and to sell them after final manufacturing stage; that Shri A.T. Patadia, Senior Manager, in his statement dated 4-4-1991 has clearly stated these facts, that he had further deposed that sample of DECA is drawn under vacuum. The ld. Counsel also relied upon the affidavit of Shri Amarnath Aggarwal, Executive Director (Operation) in which he has mentioned that the company has adopted the technology supplied by M/s. Gharda Chemicals; that this technology has not been adopted by any other person; that present manufacturing system is such that at no stage or in no manner these two in process materials can be taken out or removed or stored separately. He has mentioned in his affidavit that CMBE is in crude form, unstable, impure, hazardous and not marketable; that DECA is also not useable or used b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly he submitted that demand is time barred in Appeal No.E/4411/93-C as notice was issued on 24-9-1991 for demanding duty from September, 1987 to June, 1989; that they have all along harboured a bonafide belief and strong contention that the disputed products were not excisable; that there is not a whisper of allegation or evidence to refute the fact about holding of bona fide contention; that at the time of applying for L-4 Licence, they had given entire process of manufacture of Butachlor; that this is evident from the Range Superintendent's letter dated 19-10-1987; that from the various letters and correspondence exchanged from 19-10-1987 onwords, it is absolutely established that the Range Officer had complete details about the disputed products as well as the manufacturing process; that simply because they did not carry out the instruction contained in letter dated 19-10-1987, it would not amount to suppression as suppression of facts arises when one party conceals or suppresses the facts which are not known to the other party. He relied upon the following decisions:- 1. C.C.E., v. Chemphor Drugs & Liniments - 1989 (40) E.L.T. 276 (S.C.) 2. Padmini Products v. C.C.E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . State Electricity Board v. C.C.E. - 1994 (70) E.L.T. 3 (S.C.) wherein it was held by the Apex Court. "The fact that the goods are not in fact marketed is of no relevance. So long as the goods are marketable, they are goods for the purpose of Section 3 .....The marketability of article does not depend upon the number of purchasers nor is the market confined to the territorial limits of this country." He also submitted that removal of goods within the factory for captive consumption amounts to manufacture as held by the Apex Court in C.C.E. v. Kohinoor Mills - 1995 (77) E.L.T. 42 (S.C.). 8. Regarding demand being time barred, the ld. S.D.R. contended that as far as appeal filed by the Revenue is concerned, all demands are within the time limit specified in Section 11-A of the Central Excise Act; that the facts and evidence do not indicate that the company had any bonafide belief regarding non excisability of the impugned products that had it been so, they would not have approached the Government for granting an exemption; that they had also not declared these products to the Department. He relied upon the decision in V.S.T. Tiller Tractors v. C.C.E. - 1987 (31) E.L.T. 5 (T), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r "suitable for sale". It need not be in fact "marketed''. The article would be, capable of being sold or being sold, to consumers in the markets as it is without anything more. In this case the entire quantity is captively consumed and that is why the product is not being actually sold. The second reason for it being not actually sold is that this particular technology has only been adopted by the Company. If similar technique is adopted by any other manufacturer the product in question can be bought and sold. This is apparent from the letter dated 24-3-1990 of M/s. Ghardia Chemicals P. Ltd., the Company which had supplied the technology to the party involved in those appeals. Nowhere M/s. Gharda Chemicals says in the letter that the impugned products are not marketable or cannot be bought and sold as they are unstable or do not have shelf life. Their letter reads as follows : "To the best of our knowledge and information, there is no factory in India or overseas which has commercialised the route of manufacture adopted in the technology supplied by M/s. Ghardia Chemicals Ltd. to M/s. GNFC for the manufacture of Butalchlor. Inasmuch none of the intermediates are marketable in Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X
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