9911796707
TMI Blog1983 (12) TMI 285X X X X Extracts X X X X X X X X Extracts X X X X ..... yment of duty, the officers of the Central Excise, Bombay Division No. II visited the premises of the appellant on 3-10-1975 and found 70 fully manufactured Mechanical lighters lying in the said premises. Statement of Shri Kakubhai K. Saraiya, Prop. of the appellant firm was recorded and he admitted that he had not paid any duty so far on the Mechnical lighters sold by him. He further stated that he started manufacturing these lighters since 1970. On scrutiny of the account books of the appellant firm it was found that the said firm had manufactured and sold 46724 Mechanical Lighters without payment of duty. In addition he had also manufactured 70 Mechanical Lighters which were found in the premises of the appellant firm and were seized. 3. The officers of the Central Excise, Bombay Division II also visited the premises of M/s Fairdeal Traders at 27/29, Kolbat Lane, Bombay-2, M/s Novelac at 31/33, Kolbat Lane, Bombay-2 and M/s Natural Gas Co. (P) Ltd., Bombay where the officers found 34 `Gas-o-Fire mechanical lighters, 46 pieces of `Gas-o-fire brand of Mechanical lighters and 12 pieces of `Gas-o-fire brand of mechanical lighters respectively. The proprietors of these concerns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as appeal. 8. We have heard Shri D.K. Subhedar, Advocate for the appellants and Mrs. Vijay Zutshi, SDR and have also gone through the record and the documents produced by the parties. 9. The entire case hinges upon the fact whether GAS-O-FIRE lighters manufactured by the appellant are Mechanical lighters falling under Tariff Item No. 39 of the First Schedule to the Central Excises and Salt Act, 1944. In this regard, our attention was drawn towards Tariff Item No. 39 which reads as under :- Mechanical Lighter means any mechanical or chemical contrivance for causing ignition, which is portable and which operates by producing a spark of flame whether by itself or when brought into contact with gas, and includes a mechanical lighter issued from a factory in an incomplete state or requiring for its completion the addition of a flint. Analysing the definition given of lighter as contained in this tariff item, the learned advocate of the appellant pointed out that GAS-O-FIRE - Gas Stove Ignition manufactured by the appellant is not portable as understood in common parlance, as it cannot be used, anywhere and everywhere like a cigarette lighter which can be carried in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... voke Rule 9(2) on the ground that the goods have been cleared without payment of excise duty merely because they have taken a view that the goods are excisable long after the goods had been cleared from the factory. According to the learned advocate of the appellant, where the goods are sought to be brought to excise duty levy for the first time by the issue of demand after the goods had been cleared from the factory, the manufacturers cannot be held to have contravened Rule 9(1) so as to enable the excise authorities to invoke Rule 9(2). 10. Shri Subhedar, Advocate for the appellant also drew our attention towards case of Supreme Court, Hindustan Steel Limited v. State of Orissa (1978 E.L.T. J 159) in support of his contention that no penalty should be imposed for technical or venial legal breach of provisions or where the breach flows from the bona fide belief that the offender is not liable to act in the manner prescribed by the statute. He challenged the order of the Member of the Board also on the ground that he should have considered the nature of the different products under Tariff Item No. 39 for Mechanical Lighter, because under the Tariff Item the different products ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the authority below did not take into consideration the affidavit on this point, does not help the appellant much. As per his own advertisement made by the appellant he manufactures GAS-O-FIRE FLINT LIGHTER and they are sold as such. These flint lighters are mechanically operated and are portable and fall within the purview of Item 39 of the Tariff and therefore there was no need to take into account the affidavit that in trade parlance and market it was never considered as a mechanical lighter . Persons may say anything about a particular thing but we have to find out by the examination of that particular goods under what tariff item it is to be classified. Item 39 of the Central Excise Tariff covers mechanical lighter which operates by producing a spark or flame whether by itself or when brought into contact with gas, and includes a lighter issued from a factory in an incomplete stage or requiring for its completion the addition of flint. The fact that the apparatus does not have any inbuilt fuel to hold a flame cannot disqualify it from including it under the Tariff Item No. 39 if other requirements of the tariff item are satisfied. The case law cited by the representative of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s High Court that the provisions of Rule 9(2) would not be invoked where the excise authorities entertained a doubt as to whether the goods are excisable or not and did not object to the clearances of the goods without payment of duty. In this case the appellant never informed the excise authorities nor obtained any licence. The excise authorities were not informed when the goods were cleared and therefore the question of entertaining any doubt as to whether the goods were excisable or not could not have arisen. In a case of Bombay High Court Devidayal Rolling Refineries Pvt. Ltd. v. Superintendent of Central Excise others - 1983 E.L.T. 338 (Bom.) the applicability of Rule 9(2) and Rule 10 of the Central Excise Rules has been upheld. According to his Lordship, Rule 10 of the Central Excise Rules will apply, if demand notice was issued after assessment and if there was no assessment Rule 9(2) will apply. 17. As the goods have been removed without payment of Central Excise duty, the Collector was right in demanding duty under Rule 9(2) of the Central Excise Rules, 1944 and the plea of time limit cannot be accepted. 18. In view of our discussion above, we find no reason to i ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
