9911796707
TMI Blog2004 (7) TMI 474X X X X Extracts X X X X X X X X Extracts X X X X ..... supplies to Algerian Navy for use in like submarine. 2. From the affidavit of the Director on record, it appears that :- (a) UWB's are used primarily to generate electrical energy as a source of power in a submarine, it is by 120 x 2v = 240 Volts. It has tubular positive plates, unlike flat ones in a car battery; this ensures longer life of usually 4 years or more. The negative plates for a car batteries are a grid surface of lead alloy but in case of UWB the grid surface is always made of expended copper mesh with tin coating followed by lead plating. Special purpose P1/Darak separators are used in UWB's unlike PVC separators in car batteries. The container of UWB's cells are made up from fibre Glass re-inforced polymeric resins while in car batteries it is of PP or Hard Rubber. The covers of UWB's are also of FRP. During the manufacture of UWB, the clement of cells is placed in rubber bag which is inserted in the FRP cell box and then hermitically sealed at the top with FRP lid rubber under sole. The outer walls joined using glass tapes and resin which can be cut only with mechanical saws, destroying the cells. The Pole straps are forged with elect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and were never supplied to Indian Navy nor there was any order for the same. These parts were used in UWB's without payment of duty. 3. (a) A show cause notice cum-demand notice dated 17-2-99 was issued demanding duty during the period 1-3-1994 to 15-2-99 as the benefit of Notification 217/86 dated 2-4-86 was not available on the parts of the cells/UWB's manufactured and captively consumed since the final product viz cell/UWB's were cleared at NIL rates of duty. Allegation of suppression of manufacture and captive consumption of the parts was made to invoke the demands. Penalty proposals were also made along with interest liabilities on duties to be determined. (b) The appellants replied to the notice. Commissioner passed an order No. 41/99, dated 28-4-99 and confirmed the demands and penalties with interest. The Tribunal vide its order C-I/866-67/1999-WZB dated 2-3-2000 [2001 (137) E.L.T. 765 (T)] set aside the order & remitted on the grounds that the issue concerning the marketability of the subject products requires consideration as clear-cut findings based on material on marketability not arrived. (c) The Commissioner vide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s as recorded in paragraph 7 of the impugned order as follows :- "They further pointed out that there was not a single instance of any sale to any outside party of the said battery cells. Hence there was no question of the said battery cells being marketable products. They also pointed out that the Department had not produced any evidence to show that the said battery cells are marketable products. They stated that the invoices 156-159 produced by the Department do not relate to submarine batteries at all, but to automotive batteries." When the submissions made are not to the effect as being found, the findings therefore cannot be approved and upheld which are derived from incorrect non-existent material. Similarly no material is found to alluded which would cause to come to conclude that covers of UWB's were procured/purchased by the appellants. The appellants have submitted that the reliance on invoice Nos. 156 & 159 produced and relied by the department do not pertain to UWB's but are for automation batteries. These submissions are recorded by the adjudicator and no contrary finding is arrived. Therefore there is reason to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... brought on record and the material therein it would be apparent that the entities admittedly manufactured and alleged to be manufactured as per the notice are undisputedly made to specific designs and secret formulae and meet parameters specified by Quality Assurance Directorate of the Ministry of Defence. They are not Commercial standards and freely manufactured goods which are known in the open market to any person dealer/trader. Therefore there is force in the ld. Advocate's submissions and reliance were placed on the decision of the Supreme Court in the case of Union of India v. Sonic Electrochem (P) Ltd. [2002 (145) E.L.T. 274 (S.C.)]. Therein the court had while dealing with the specific designed body of EMR, would satisfy the criteria of marketability for levy of excise duty held - "......The essence of marketability is neither in the form nor in the shape or condition in which the manufactured articles are to be found, is it the Commercial identity of the articles known to the market for being bought and sold. The fact that the product in question is generally market would be irrelevant. The plastic body of EMR does not satisfy the aforesaid ..... X X X X Extracts X X X X X X X X Extracts X X X X
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