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TMI Blog2007 (2) TMI 421X X X X Extracts X X X X X X X X Extracts X X X X ..... enalty of equal amount on the party under Section 11AC of the Central Excise Act, besides another penalty of Rs. 1.25 crores on them under various rules. The demand of duty is on computers. The assessee, namely, M/s. CCS Infotech Ltd., a public limited company, has been held to have manufactured computers through assembly of bought-out components or through upgradation of bought-out computers. The company was carrying out activities like (a) enhancing memory of the system (b) upgradation (c) enhancement of the speed of the processor (d) adding floppy drives (e) adding CD drives (f) adding/enhancing the capacity of hard disc drive and (g) adding/enhancing the capacity of the display card on bought-out computer systems. A partnership firm nam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manufacture of computers and not to treat the same as trading activity . This case of the assessee has been reiterated by their Counsel. The demand of duty is also challenged on the ground of limitation. It is submitted that the assessee was under the bona fide belief that they were not required to pay duty on the activities performed by them on bought-out computers and components thereof. 2. Ld. SDR on the other hand, submits that the Board s Circular did not pertain to brand-new computer systems. The assessee was engaged in purchasing such systems and upgrading the same and selling the same under a brand- name. Ld. SDR has reiterated other findings of the Commissioner also. 3. After considering the submissions, prima facie, we are o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re for the purpose of levy of duty of excise on the computers assembled/upgraded/branded by them. It was also pointed out by them that neither any Section Note nor Chapter Note worked against them so as to disapprove the above plea. Though learned Commissioner asked for case law on the point, he did not find any case law to the contrary either. In the circumstances, the plea of limitation also seems to be forceful. 4. In the result, we are inclined to grant waiver of pre-deposit and stay of recovery in respect of the duty and penalty amounts. It is ordered accordingly. 5. Having regard to the high stake involved in the case, as pointed out by ld. SDR, we are inclined to dispose of the appeal itself as early as possible. Accordingly, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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