1999 (4) TMI 316

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... -duty paid aluminium powder with the turpentine and varnish and the prepared paint was used captively for coating drums used for packing of aluminium powder within the factory itself. In the show cause notice dated 12-4-1991, the Central Excise Duty of Rs. 4,030.36 in respect of aluminium powder and of Rs. 10,843.20 in respect of aluminium paint was demanded. The appellants agreed to pay the central excise duty due on aluminium powder. With regard to the diluted aluminium paint, it was contended that it could not be marketed and had a very short shelf life. It was their plea that such prepared diluted aluminium paint was not dutiable. The Addl. Collector of Central Excise, Madurai, held that the aluminium powder said to be floor sweepings w .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... and had wide use. It is bought and sold in the market and was required to discharge the duty liability before use. 4. We have carefully considered the matter. The appellants had accepted their duty liability to pay central excise duty on the aluminium powder captively consumed for the preparation of diluted aluminium paint. The central excise duty demanded had already been paid. The only issue for our consideration is the demand of central excise duty with regard to the diluted aluminium paint. The appellants had submitted that in the process of manufacture of aluminium powder, certain floor sweepings are obtained. They had used such aluminium powder floor sweepings to prepare diluted aluminium paint for immediate use for painting of the .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... weepings and used the same for the manufacture of aluminium paint. He noted that prior to the visit of the officers, the assessee had not intimated the removal of the aluminium powder used captively to the Department. The appellants had not placed any material on record to rebut these findings of the adjudicating authority. 8. Taking all the relevant facts and circumstances of the case into accounts we set aside the demand of Rs. 10,843.20 in respect of prepared diluted aluminium paint used, after such preparation, to paint their own empty drums which were used subsequently for packing their final product-metal powder. The demand of central excise duty of Rs. 4,030.36 in respect of the aluminium powder which the appellants had described a .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X