9911796707
TMI Blog2010 (11) TMI 812X X X X Extracts X X X X X X X X Extracts X X X X ..... e or unfinished but having the essential character of finished articles into complete or finished article would amount to manufacture and the same has necessarily to be understood qua the requirement of the customers - Decided against the assessee Jurisdiction of the excise officer for conducting the investigation and adjudication proceedings - Held that:- It is settled law that when a cause of action in relation to offendable incident or in relation to series of activities which are offendable or the violation of the provisions of law arises within the jurisdiction of different investigating officers or adjudicating officers, every such officer will have jurisdiction to investigate and or adjudicate upon such offence or violation arising in all such territories. Merely because installation was carried out beyond territorial jurisdiction, once it is established that the major activity of manufacturing in relation to such machines was carried out at Rampur which lies within the jurisdiction of Meerut Commissionerate, it cannot be said that Commissioner at Meerut had no jurisdiction to investigate and adjudicate upon the matter - Decided in favor of Revenue Extended period of l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tatements of Shri S.K. Gupta, Financial Controller, Shri Nitin Jagtap, Head Technical Support, Shri Arvind Kumar Srivastava, Sr. Manager (Distribution), Shri Anil Kumar Gupta, Dy. General Manager (Imports) and Shri Prabhat Kumar Gupta, General Manager (Planning and Technical) were recorded under Section 14 of the Central Excise Act, 1944. In the course of investigation and pursuant to the scrutiny of the said statements and documents, it was revealed to the Department that the appellants were engaged in the manufacturing activities of goods under the guise of trading and such goods were cleared without payment of duty. And thus, they were engaged in clandestine removal of such goods without payment of duty. On completion of the investigation, a show cause notice dated 18th of April, 2007 came to be issued to the appellants. The same was contested while contending that their activities were nothing but installation of Copiers-cum-Printers and no new product emerged from such activities. Even if the process was to be termed as manufacturing, the same was carried out beyond the territorial jurisdiction of the Commissioner of Meerut and in any case the demand was barred by limitation a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vocate for the appellants while assailing the impugned order submitted that the authority below has considered the activity as manufacturing activity essentially on the basis of Note 6 to Section XVI of the Tariff Act. He submitted that the Copier-cum-Printer was complete in itself and was cleared in modular form merely for ease of transportation and also because the goods were imported in such modular form. According to ld. Advocate, no activity was carried out by the appellants in the premises at Rampur which could amount to manufacture. The relevant bills of entry disclose that the Copier-cum-Printers were imported in Modules equal in number and the classification and assessment thereof had been done as Copier Printers only. Thus, the machines in modular form were complete machines and no process was carried out by the appellants to make machines complete, as they were already complete in all the respect. Reliance is placed in the decisions in the matter of Eureka Forbes Ltd. v. CCE, Chandigarh, reported in 2000 (120) E.L.T. 533 (Tri.-LB), Indian Xerographic System Ltd. v. Collector of Customs, Bombay reported in 1995 (80) E.L.T. 337 read with 1997 (93) E.L.T. A68, Eureka Forbes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etimes customers desired stabilizers due to fluctuations in the electric voltage supply. Pin tops are nothing but adapter for power supply to meet the local conditions. Packing material was used for the sake of proper transportation bearing in mind the road conditions. The stands for various articles like coolers, refrigerators, TV Trolleys, etc., were supplied along with some models which were domestically procured. All these items cannot be the basis to hold that the appellants were involved in the manufacturing activities. 10. He further submitted that the appellants did not undertake any manufacturing activity at Jolly Godown due to lack of facilities such as optical alignment fixture which was required to align the mirror and lenses. Besides, some old serial numbers were given to the machines as old machines were showing the need of cannibalization for having new machines with cannibalized parts. Such activities were carried out at the factory and on the new product so manufactured, duty was duly paid. However, at the Jolly Godown, even if, it is assumed to have conducted manufacturing activity, the appellants would have credit far in excess of duty demanded as per the provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and unless and until the same had undergone the process of kitting. By application of Rule 2(a) of the Interpretation Rules read with Note 6 of Section XVI such activities are to be assessed as amounting to manufacture. Attention is drawn to the decision in the matter of Commissioner of Central Excise, Delhi-III v. BHP Engineers reported in 2000 (119) E.L.T. 599 and Shrike Construction Equipments Pvt. Ltd. v. CCE, Pune reported in 1997 (95) E.L.T. 644. 14. It was also sought to be contended on behalf of the Department that the manner in which invoicing was done in relation to the goods supplied to the customers by the appellants is also of great relevancy. According to Jt. CDR, it was noticed that the description of the articles in the invoices issued by the foreign suppliers was totally different from the one in the invoices issued by the appellants to the customers. The invoices issued by suppliers speak of kits, whereas the invoices issued by the appellants refer to complete machines. If the goods cleared from the warehouse were invoiced differently, the only logical conclusion which can be drawn is that invoices issued for the goods cleared from the warehouse related to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herein and particularly whether kitting and partial assembly can be considered as the process of manufacture and whether the final products were same as were imported were not dealt with by the Tribunal in the said case and the same is therefore distinguishable. 19. Considering the rival contentions canvassed in the matters, the following points arise for consideration : (i) Whether the activity carried out by the appellants amounts to manufacture within the meaning of the said expression under Section 2(b) of the said Act read with the Note 6 to Section XVI of the Central Excise Tariff Act, 1985? (ii) Whether the Commissioner, Meerut lacked territorial jurisdiction to initiate the action and/or to deal with the matter in the facts and circumstances of the case? (iii) Whether the facts and circumstances of the case justified invocation of extended period of limitation or whether the demand was barred by limitation? (iv) Whether the decision of the Bangalore Bench of CESTAT under Final Order No. 1331-1333/09 [2010 (252) E.L.T. 273 (Tribunal)] is a complete answer to the issues involved in the matter? (v) Whether the demand in the matter in hand stands aba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f kitting is concerned, it has been held that the process of kitting in respect of imported parts/modules/accessories was admittedly done in the factory/warehouse premises of the appellants and some indigenous accessories like pin top, software, RAM, Stabilizers, stands for some models and papers were also used in such process. At the same time admittedly no kitting process was undertaken in respect of the machines which were imported as complete machines and sold as such or where the parts/accessories were cleared/sold as such. This obviously discloses the process of kitting was an important process between the act of importation and the act of final supply of the machines to the customers as fully functional units. It has been further held that the process of kitting included, selection of parts/modules and accessories of machines as per the customers requirement and putting them together, assembling and fixing of some parts/accessories with main modules. Utilisation of indigenous parts and accessories was to meet the specific requirements of the customers and assigning a new number for the purpose of accounting and identifying the product for the purpose of valuation and issuanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d into the main machine for the reasons of odd shape of such part or for safety during the transportation were assembled at the place of customers in the course of installation. It has been further held that the activity of assembling various parts modules and accessories was ancillary process for manufacture of fully integrated machine. Taking into consideration the activities of assembling and documentary evidence in the form of purchase orders, storage tickets, invoices, etc., it was held that the same resulted in conversion of imported modules/parts with the assimilation of an indigenous parts and accessories and kittings transformed into a new product, with new name, character and use and that modules/parts/sub-assemblies and machine in SKD conditions were not able to perform the function what the newly formed machine would perform. 25. It has been held that admittedly the process of kitting is done in the factory/warehouse premises of the appellants and various indigenous parts and accessories were purchased and included in kitting with those imported items. No kitting was done in respect of machines which were imported as complete machines and sold as such or even where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s sought to be argued on behalf of the appellants that on importation of modules and parts of the machines they were merely installed at the premises of the customers along with indigenously procured parts and accessories and it involved no activity in the nature of manufacture, it is clearly established from the records that on importation of modules and parts, by themselves, either individually or even taken together, did not constitute complete machine or unit and in order to form a complete machine or unit, the same had to undergo the process of configuration along with some other indigenously procured parts and accessories without which the machine was incomplete and non-functional. It has also been established from the record that kitting formed important activity prior to supply of the goods at the customers premises. This is also corroborated from the fact that in cases where complete machines were imported they were supplied to the customers without any kitting activity being involved but in case of machines required configuration of other indigenously procured parts and accessories to make the machine operative and functional and the activity of supply and installation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earlier view in the matter of Pragati Silicons Pvt. Ltd. v. Commissioner of Central Excise, Delhi reported in 2007 (211) E.L.T. 534 (S.C.) held that there is difference between the parts and accessories . It was further held that a part is an essential component of the whole without which the whole cannot function, whereas an accessory is something supplementary or subordinate in nature and need not be essential for actual functioning of the product. 29. Admittedly, in order to make the modules and parts imported by the appellants to be functional or to put to intended use, it was necessary for the appellants to assemble the said modules and parts along with other parts and accessories procured indigenously and such assembling was done with proper alignment and testing by engineers. Very fact that some parts were procured indigenously and they were fitted along with the imported modules and parts to make the machine functional, the activity undergone clearly resulted in bringing out a new product amounting to manufacture of a product, new in character and use, and commercially known as such. The activity obviously amounted to manufacturing within the meaning of said Section 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Another reported in 1983 (14) E.L.T. 1736 (Bom.) while dealing with the question as to whether the petitioners therein who were carrying on the business of bleaching, dyeing, printing and finishing cotton fabrics were liable to pay the excise duty as the manufacturers for the purpose of the Central Excise Act, 1944 after taking into consideration the decisions of the Apex Court in Union of India v. Delhi Cloth and General Mills [A.I.R. 1963 S.C. 791 = 1977 (1) E.L.T. (J199)] and Allenbury Engineers v. S.R. Dalmia (A.I.R. 1973 S.C. 425) held that the test to be applied must, therefore, be whether the processes in question have resulted into bringing into being a distinctively new article which is known to the market . Referring to the facts of the case, it was held by Bombay High Court that it is not in dispute that what is given to the processors is grey cloth which is unbleached. That grey cloth is undoubtedly the main product of the manufacturing processes. When this grey cloth is made available to the processors, it is first bleached and then dyed, printed and finished. Now, the argument of the learned Counsel for the petitioners is that after bleaching, dyeing, printing and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the provisions of Section 2(f) of the said Act and Note 6 of Section XVI of the Tariff Act, it would at once be clear that the activity of kitting which also involved assembling would constitute manufacture within the meaning of the said expression under the said provisions of law. Undoubtedly, the appellants imported modules and parts of such machine. They were thereafter assembled along with indigenously procured parts and accessories. The process also involved the one relating to alignment and meeting the required configuration as per the requirement of the customers. Further the process was undertaken with the help of engineers. The essential part of all such process was done in the factory or the warehouse. While transporting the machines so formed, some parts thereof, were de-assembled or packed separately along with the machine to be fitted at the time of installation on account of difficulty in transportation or from the point of view safety of such article or articles in the course of transportation. But in the absence of the said process being undergone, the machine did not become functional. As already seen above, an assembly of the parts itself would amount to manufac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal had also observed that it is not the case of the appellants that the components imported by them can be used as fax machine without the process of assembly undertaken by them. Only the process undertaken by them makes the component complete or finished product . Similarly, it is essentially the process of assembly that made the product to be complete or finished product. 39. The Apex Court in Gramophone Co. of India Ltd. v. Collector of Customs, Calcutta reported in 1999 (114) E.L.T. 770 (S.C.) was dealing with the question as to whether the activity of duplicating music recorded on audio cassette amounted to a process of manufacture or not and after taking into consideration its earlier decisions in the matter of Delhi Cloth Mills (supra), Empire Industries Ltd. (supra) Ujagar Prints v. UOI reported in 1988 (38) E.L.T. 535 (S.C.), Decorative Laminates (India) Pvt. Ltd. v. Collector reported in 1996 (86) E.L.T. 186 (S.C.), UOI v. Parle Products Pvt. Ltd. reported in 1994 (74) E.L.T. 492 (S.C.) and Laminated Packings (P) Ltd. v. Collector reported in 1990 (49) E.L.T. 326 (S.C.) held that the moment there is transformation into a new commodity commercially known as a di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n assembly would have the essential character of the complete or finished article. No doubt the assessee were required to procure some local components to complete the assembly of engine. Having noted these facts, it was held that the fact that some of the components were locally required to be procured to complete the assembly of engine could not make Rule 2(a) in applicable as Rule 2(a) is there to be invoked in such cases only for the purpose of determining classification of the product. It was further held that as per Explanatory Notes of HSN, the first part of Rule 2(a) extends the scope of any heading which refers to a particular article to cover not only the complete but also that article, incomplete or unfinished, provided that, as presented, it has the essential character of the complete or finished article . The Explanatory Notes below Section XVI of H.S.N. explains the applicability of Rule 2(a) by providing that machines lacking only a fly wheel, a bed plate, calendar rolls, tool holders, etc. is classified in the same heading as the machine, and not in any separate heading provided for parts . Thus, it is apparent that some part of an article may not be there and ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said Act. It was held that if the end product is a separate product which comes into being as a result of an endeavour and activity of the assessee, then the appellant must be held to have manufactured such item. 45. In B.P.L. India Ltd. case the assessee had imported 100 kits of VTR with colour monitors in disassembled condition and they were described in invoices and the bills of entry as sets of assembly, sub-assembly and other hardware items for assembly of complete VTR and colour monitors . During the period from June, 1982 to August, 1982 such products were manufactured and cleared and on 12th August, 1982 the Superintendent of Central Excise under his letter asked the assessee to furnish details of sets cleared and to explain why duty should not be demanded on those sets? No information was furnished by the assessee and consequently, show cause notice dated December, 1982 came to be issued. Analysing the facts of the case, the Apex Court observed that the imported kits of components of VTR and colour monitors in SKD conditions were the items falling under item 68 for levy of countervailing duty. By the process undertaken by the assessee a change is brought about facil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of a incomplete or unfinished into complete or finished article can amount to manufacture. If the acquaguard was complete in itself then the said Note 6 would not be attracted. It was finally held that the acquaguard which was cleared by APIC was a unit complete in itself which filtered and purified the water and, therefore, Note 6 was not applicable. The decision therefore is clearly distinguishable on facts. 48. In Indian Xerographic System s case, the Tribunal relying upon its earlier decision in the matter of M/s. Walchand Nagar Industries (supra) held that unassembled photocopier machines imported had correctly been assessed subject to additional duty of customs under Item 33D of the Central Excise Tariff as the goods answered the Tariff description. It was also held that the unassembled machines had discharged the duty liability under Item 33D on import, and therefore, the Department had no case for subjecting it again to the duty under the Central Excise Tariff Act. When the assessee clears the machines in assembled form, as no manufacturing activity had taken place. The finding about absence of manufacturing activity was essentially arrived at on the basis of decision in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oyed microscopic bacteria and viruses present. The water was then ready for removal. The unit was manufactured by wholly owned subsidiary of M/s. AP Industrial Company Ltd. who used to send the unit to the assessees warehouse. The assessee thereafter used to pack that article and the second component i.e. pre-filter in one carton. The pre-filter was purchased from the market and it consisted of a bowl housing a polypropylene filter candle. It was not in dispute that the sales of that product were predominantly with the pre-filter and that it was not advertised that the purchase of the filter was optional; although it was contended that some small proportion of the sale was without pre-filter. It was also stated that the object of pre-filter was to remove the coarser particles contained in the water to be purified before it enters the chamber containing the activated carbon. The contention that the commodity which earlier carried out the function of water purifier had changed into a commodity which was a water filtration and purification apparatus was rejected as it was not established that the said commodity did not act as filter and that the activated carbon performed some functi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to an activity of manufacture under Section 2(f) of the said Act. The Apex Court had dismissed the appeal against the said order. 55. In Nugas Technologies India (P) Ltd. case, the Tribunal was dealing with the case wherein the diesel run buses of Delhi were found to be highly polluting and in order to reduce pollution, those engines were converted into CNG engines. Some of those engines were already in use since 1992 while the conversion from diesel to CNG was carried out in the year 2001 and 2002. The Tribunal taking note of the fact that the assessees had merely made some modification in the already existing engines so as to make them capable of accepting another fuel and that the modification did not bring into existence new goods, applying the principle with alteration or modification already existing manufactured product would not amount to manufacture held that conversion of machine from diesel to CNG would not attract excise duty. 56. In the case of Sirpur Paper Mills Ltd. v. Collector of Central Excise, Hyderabad reported in 1998 (97) E.L.T. 3 (S.C.), while answering the dispute about leviability of excise duty on the paper making machine erected by the assessee by u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he paper increases so that it can be used for packing purpose. Undoubtedly for certain articles kraft paper can also be used tor packing purpose but on account of its thinness, it would not be durable and it could torn out immediately or even while packing an article. It is least durable while bituminized water-proof paper can be used for packing even heavy articles and it is durable. Moreover, the character is also changed as the name itself indicates. In commercial world, both the articles are known and marketed by different names. 59. In the case of Makson Pharmaceuticals (I) Ltd. v. Commissioner of Central Excise, Rajkot reported in 2006 (202) E.L.T. 129 (Tri. Mumbai), the Tribunal relying upon the decision of the Apex Court in the matter of Sirpur Paper Mills Ltd. (supra) and of the Larger Bench of the Tribunal in the matter of Mahindra and Mahindra Ltd. v. Commissioner reported in 2005 (190) E.L.T. 301 (Tri.-LB) held that a water treatment plant could be fixed on a foundation, it was required to be assembled so that it could function as water treatment plant. It could not only be fixed on a foundation but could also be removed by retaining its character as a water treatment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whereas others were modified to suite to the requirements of the customers and in some cases even parts and accessories were sold. The main dispute relates to the activity in respect of the machines imported as per the requirement of the customers. While it is the case of the department that such supply is made after necessary manufacturing process as per the need and requirement of the customers, whereas it is the defence of the appellants that there was merely an assembly of module/parts of the machines done by the appellants, and that too, at the site of installation as supply was in modules or parts. The assembling process described as kitting, involved configuration of the parts of the product as per the requirement of the customers and the same resulted in manufacture thereof. 63. The contention that the absence of the phrase presented in disassembled or unassembled form in Note 6 would justify its non-applicability to the facts of the case is totally devoid of substance. Undoubtedly, the Note 6 speaks of a situation wherein there would be a deemed manufacture. It is relating to an activity which is deemed to be manufactured within the meaning of the said expression under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... process was carried at the factory-cum-godown of the assessee at Kunjurmarg, Mumbai. Taking into consideration the definition of the term manufacture under Section 2(f) of the said Act and the dictionary meaning of the said word it was observed that condensing units were manufactured by the appellants at its factory at New Delhi and the cooling units were procured from the local market for which the electrical motors were supplied by the appellants. Neither the condensing unit nor the cooling unit by itself is a complete air-conditioner. It is only when these two, i.e. condensing unit and cooling units are put together the complete unit of air-conditioner fit for use came into existence at the Kanjumarg workshop. Air-conditioner is a commercially new article than either the condensing unit or the cooling unit . Having so observed the contention of the assessee that there was no manufacture at Mumbai unit was rejected. 66. In A.P. Heavy Machinery Engg. Ltd. v. Commr. of C. Ex., Hyderabad reported in 2001 (128) E.L.T. 155 (Tri.-Chennai), the Tribunal was dealing with the case relating to conveyor system and taking into consideration the fact that the product being cleared by thr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... what was the need of undergoing kitting process to make the machine complete as per the configuration of the machine required by the customer. In other words, kitting process essentially comprised of activity on the part of the appellants to make the machine suitable to meet the requirements of the customers. In the absence of such activity, in other words, the machine could not be said to be complete for supply to the customers. Shri S.K. Gupta, the Financial Controller as well as the Deputy General Manager have confirmed in their statements that some modules of the machine had not been received by their unit in assembled condition and without adding the required parts even those machines were not complete. Shri P.K. Gupta, General Manager on his part while giving details about the parts which were imported in different consignments also emphasised the need for the parts which were necessary for assembling of machines as per the requirement of the customers. The fact that the installation of machines in the same form in which they were imported was not possible unless it had undergone the process of kitting to make them suitable to meet the requirements of the customers was also c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t by the appellants in their premises at Rampur which would amount to manufacture, the statements of the various officers of the appellants themselves speak to the contrary. The materials on record clearly disclose various activities which were carried out in the name of kitting. If the contention on behalf of the appellants that the machines in modular form were complete machines and no process was required to be carried out by the appellants to make the machines complete is to be accepted, then one fails to understand how the various officers have described the activity of kitting to include various acts on the part of the appellants to make the goods to undergo various changes as per the requirement of the customer, and that too, to make the machines functional. 74. The contention that no evidence has been brought on record by the department to prove the factum of manufacture is totally devoid of substance. Adducing evidence on record may be either in the form the department itself producing the evidence or it could be by placing reliance in the evidence produced by the assessee. In case the assessee volunteers to adduce evidence, which is sufficient to prove the case of the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also in the written submissions, nothing is pointed out to us which would disclose any sought of perversity or incorrectness in the findings of facts arrived at by the Commissioner on relevant aspects of the matter. 78. In fact, the findings of facts stand corroborated by various statements of different executives of the appellants. The impugned order specifically refers to the relevant portion of the statements of such executives. It is not the case of the appellants that the said statements were either retracted or could be shown to be factually incorrect. 79. As already held above, the contention that in terms of the provisions of Rule 2(a), in the absence of the phrase presented unassembled or disassembled in Note 6 to Section XVI, the later cannot be brought into play to allege manufacturing activity is also devoid of substance. The expression as presented or presented in Rule 2(a) essentially refers to the condition in which the goods are presented for the purpose of classification. It essentially refers to the stage of clearance for the purpose of the classification. Under the guise of interpretation, the Tribunal cannot twist or distort the meaning of a statutory ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Bangalore Bench itself and particularly in para 8 thereof wherein it has been stated thus:- 8. The ld. Spl. Counsel for Revenue relied on case laws to support the view that there was manufacture in the process described and cited (i) Xerox Modicrop. Ltd. v. CCE, Meerut-II [2001 (130) E.L.T. 219 (Tri. -Del.)], (ii) Tanzeem Screenarts v. CCE, Mumbai-I [2006 (196) E.L.T. 209 (Tri. Mumbai)] and (iii) Commissioner of C. Ex. Coimbatore v. VXL Systems [2009 (235) E.L.T. 109 (Tri. -Chennai)]. In these cases there were components manufactured and/or components assembled by the assessee concerned to make complete machine. In the case on hand the parts found to have been fitted to the main module were not dealt with except for removing them in sets in their original packing. By grouping the parts of a complete copier with printer or without printer, assigning the parts in each set a unique number using a computer, we hold, does not amount to manufacture. There is no conversion of an incomplete machine into a complete machine in the warehouse to attract the Section Note 6 of Section ZVI . (Emphasis supplied). Therein it was a case of grouping and not of assem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stified in invoking extended period of limitation. 85. As regards the claim for Cenvat credit, obviously, the assessee has to comply with the provisions of law for claiming such benefit. No material on record has been pointed out which would reveal entitlement for such benefit to the appellants at this stage. Submissions are required to be made on the basis of actual foundation which are very much lacking in the case in hand in relation to the said contention on behalf of the appellants. It would be for the assessee to establish that they had complied with the requirements of the provisions of the Cenvat Credit Rules, 2002 as amended by Cenvat Credit Rules, 2004 which clearly required maintenance of proper records regarding receipt of the inputs and utilization thereof, inventory of inputs, the credit utilized in terms of the provision of law, etc. It would be obviously for the assessee to claim such benefit and to establish the same, by following the procedure in accordance with law. 86. Yet another ground which was sought to be canvassed, though half heartedly, in the course of oral submissions was about the absence of jurisdiction to the Commissioner at Meerut to deal with t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... created by the law to prevent tax evasion. The machinery provisions in a fiscal legislation are to be liberally construed so as to effectuate the purpose behind the said machinery provisions. When the cause of action arises within the territorial jurisdiction of a particular officer, he is competent to have the matter investigated even in an area outside his jurisdiction. It would not be a case of stretching the jurisdiction beyond his territory at all. The substance of the jurisdiction is to adjudicate on the question of taxability or tax evasion. This adjudication can be properly done in many cases by getting the investigation done elsewhere to gather the relevant material. The very purpose of investigation and adjudication would be lost if such a meaningful jurisdiction is not read into the jurisdiction of the authorities functioning under the taxing statute. 90. It is also to be noted that the Apex Court, in Pahwa Chemicals Pvt. Ltd. v. Commissioner of Central Excise, Delhi reported in 2005 (181) E.L.T. 339 (S.C.) after considering the scheme of the Excise Act, the powers of the Board under the said Act as well as that of the excise officers, had held as under : 12. As not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se administrative directions cannot take away jurisdiction vested in a Central Excise Officer under the Act. At the highest all that can be said is Central Excise Officers, as a matter of propriety, must follow the directions and only deal with the work which has been allotted to them by virtue of these Circulars. But if an Officer still issues a notice or adjudicates contrary to the Circulars it would not be a ground for holding that he had no jurisdiction to issue the show cause notice or to set aside the adjudication . 91. The issue in relation to the jurisdiction of the excise officer for conducting the investigation and adjudication proceedings has to be answered bearing in mind the law laid down by the Apex Court and Karnataka High Court in the above referred two decisions. Having understood the law accordingly, it is abundantly clear that in the facts and circumstances of the case, that there is no scope to content that the Commissioner at Meerut lacked jurisdiction to deal with the matter. 92. The contention about right to abatement of duty to the extent of Rs. 11,80,60,202/- is obviously based on the claim of Cenvat credit. In case of claim of Cenvat credit and abateme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of texture, moisture, absorption capacity, feel, etc., are the same as the tissue paper in the jumbo rolls The said jumbo rolls cannot be conveniently used for household or for sanitary purposes. Therefore, for the sake of convenience, the said jumbo rolls are required to be cut into various shapes and sizes so that it can be conveniently used as table napkins, facial tissues, toilet, etc. However, the end-use of the tissue paper in the jumbo rolls and the end-use of the toilet rolls, the table napkins and the facial tissues remains the same, namely, for household or sanitary use. The predominant test in such a case is whether the characteristics of the tissue paper in the jumbo roll enumerated above is different from the characteristics of the tissue paper in the form of table napkin, toilet roll and facial tissue. Obviously, the modular and components of the printer copiers cannot perform the same function which a complete machine of photocopier printer can perform. In the said S.R. Tissues Pvt. Limited case, it was also held that value addition on account of transport charges, sales tax, distribution and selling expenses and trading margin cannot be a indecent to decide what is ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
