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TMI Blog2017 (6) TMI 214X X X X Extracts X X X X X X X X Extracts X X X X ..... the processed material under the same Tariff Heading CTH. The Hon ble Supreme Court and the Tribunal in various decisions held that such process cannot be treated as manufacture under Section 2(f) of the CEA, 1944. The declaration before the Income Tax authorities would not determine the excisability of the goods unless it is covered under the Central Excise law. Appeal dismissed - decided against Revenue. - E/211/07 - FO/A/75961/2017 - Dated:- 31-5-2017 - Shri P. K. Choudhary, Member (Judicial) And Shri Devender Singh, Member (Technical) Shri S.Mukherjee, Supdt.(AR) for the Revenue Shri S.K.Mehta, Advocate for the Respondent ORDER Per: Shri P. K. Choudhary Revenue filed this appeal against Order-in-Appeal No.01/HAL/07 dated 10.01.2007 passed by the Commissioner(Appeal-I), Central Excise, Kolkata, whereby the appeal filed by the respondent was allowed holding that the process mentioned in the Adjudication order does not amount to manufacture. 2. Briefly stated the facts of the case, are, as under:- (i) On 23.09.2005, the officers of the Haldia Central Excise Commissionerate conducted search at the registered office as well as factory pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respondent assessee challenged the said order dated 02.01.2007 by filing appeal before the Commissioner(Appeals). By the impugned order, the Commissioner(Appeals) allowed the appeal of the respondent/assessee and held that the process undertaken by the respondent/assessee does not amount to manufacture. Hence, the Revenue filed this appeal before the Tribunal. 3. Heard both sides and perused the appeal records. 4. The ld.A.R. appearing on behalf of the Revenue raised the preliminary issue in so far as the Assistant Commissioner (AE), Central Excise, Haldia Commissionerate did not issue any order, rather he passed on the information to the Commissioner, for issuance of the Show Cause Notice, which was issued on 21.03.2006 proposing demand of duty along with interest and penalty. It is further submitted that the respondent assessee had not filed any reply to the Show Cause Notice and took a short-cut method and preferred an appeal before the Commissioner(Appeals). Hence, Commissioner(Appeals) should not have entertained the appeal filed by the respondent assessee, against the communication which is not an order. It is further contended that the respondent assessee preferred an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision, which has been made on merit, other legal procedures may be followed. And thereby, complied with the directives of the Hon ble High Court at Calcutta. On perusal of the aforesaid communication dated 02.01.2007, it is apparent that the Assistant Commissioner (HQAE) passed an order dated 15.03.2006. The expressions order of Assistant Commissioner(HQ-AE) dated 15.03.2006 in communication dated 02.01.2007, makes it clear that the Assistant Commissioner passed an order and therefore it is appealable before the Commissioner(Appeals) under Section 35 of Central Excise Act, 1944. In any event, the decision of the Assistant Commissioner of Central Excise that the Respondent-assessee is involved in the manufacturing process and they are required under the Central Excise law to get themselves registered would impose upon the Respondent-assessee obligations affecting their civil consequences and such decision is appealable. Therefore, we are unable to agree with the submission of the ld.A.R. on the preliminary issue. 7. The other aspect on the preliminary issue is that the Revenue contended in their appeal that the Respondent-assessee took a short-cut method and preferred the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authorities on goods imported by it. The appellant craves leave to refer to the literature/specifications of slack wax and residue wax at the time of hearing. 2. As part of the appellant's business the appellant does High Sea Sale and local sale. Slack wax/residue wax are imported in drum. Foot oil being part of residue wax/slack wax comes up as being lighter which are siphoned by tilting the drums. The balance Slack Wax and Residue Wax are strained by wrapping it in cloth made of cotton or jute. Such wrapped cloths are kept one above the other. Thereafter pressure by hand or hydraulic pressure (like car jack) is given which strains squeezes slack wax/residue wax. The appellant sell pressed wax and foot oil separately. 3. There is no manufacturing process involved in it. The appellant is only separating foot oil from slack wax or residue wax by straining only. 4. The entire process of separating foot oil from residue wax is graphically shown hereinafter. 5. By no stretch of imagination the activity mentioned above could be called manufacturing under the Central Excise Act, 1944. 6. No new product comes out. Foot oil is already there. Wax is already ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xt, we reproduce the findings of the Commissioner(Appeals) as under:- In the impugned order Foot Oil is treated as a product manufactured from slack wax and residue wax. But actually in the technical literature these are treated as synonymous. Pressed wax and paraffin wax have been classified as manufactured product under 271220. To quantify under this heading oil content in wax is to be less than 0.75%. In the present case it is much higher. Hon ble Supreme Court ruled in Hindustan Poles Corporation Vs. CCE, [2006 (196) ELT 400 (SC)] that the burden to prove manufacture lies on Revenue. In this case only different names of the same commodity have been shown as raw material and finished product. True scope of manufacture was expanded by amendment of Sec.2(f). On this amendment, Hon ble Supreme Court rule in Shyam Oil Cake Ltd. Vs. CCE, [2004 (174) ELT 145 (SC)]. We are in agreement with the submission that under the amended definition, which is an inclusive definition, it is not necessary that only in the Section or Chapter Note it must be specified that a particular process amounts to manufacture. It may be open to so specify even in the Tariff Item. However, either in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court) page 58] wherein it was held that the same words may mean one thing in one context and another in a different context. This is the reason why decisions on the meaning of particular words or collection of words found in other statues are scarcely of much value when we have to deal with a specific statute of our own. In fact the definition of manufacture for SEZ is different (Board's Circular No.314/30/97-CX dated 6.5.97). Such definitions in West Bengal Finance Act, 1944, West Bengal Sales Tax Act, 1944, West Bengal Value Added 2003, Exim Policy etc. are all different. Exim policy includes aqua character, Horiculture etc. in manufacture West Bengal Vat Act includes rearing of seedlings or plants.. Therefore, declaration to other department is irrelevant in this context. The criteria of Central Excise have not been satisfied. I, therefore, allow the appeal and hold that the process mentioned in the impugned order does not amount to manufacture. 13. In the case of CCE, Jamshedpur v. Castings (India) Inc. [2016 (342) ELT 343 (Jhar.) , the Hon ble Jharkhand High Court dismissed the appeal filed by the Revenue. It has been observed that even if there are two separate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at Paragraph No. 24 which reads as under : 24. In this case, neither in the Section Note nor in the Chapter Note nor in the Tariff Item do we find any indication that the process indicated is to amount to manufacture. To start with the product was edible vegetable oil. Even after the refining, it remains edible vegetable oil. As actual manufacture has not taken place, the deeming provision cannot, be brought into play in the absence of it being specifically stated that the process amounts to manufacture. (Emphasis supplied) 5. In view of the aforesaid facts, reasons and judicial pronouncements, no error has been committed by the Customs, Excise and Service Tax Appellate Tribunal in deciding Appeal Nos.EMD 01-03 of 2005, dated 27th July, 2006/31st July, 2006, and we are in full agreement with the decision of the Customs, Excise and Service Tax Appellate Tribunal, Eastern Regional Bench, Kolkata as substantial question of Law No. 1 that an error has been committed by Tribunal by holding that the activities for processing TMT coils into TMT bars/rods after de-coiling, straightening and cutting into size is identical to the activity in the case of M/s. Faridabad Iron ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would be groundnut oil and if so it does not seem to accord with logic that when the quality of the oil is improved in that its resistance to the natural processes of deterioration through oxidation is increased, it should be held not to be oil. (Emphasis supplied by us) 20 . In Delhi Cloth General Mills Co. Ltd. (supra), yet another Constitution Bench, exploring the concept of manufacture echoed the following views : 14 ......The word manufacture used as a verb is generally understood to mean as bringing into existence a new substance and does not mean merely to produce some change in a substance, however minor in consequence the change may be. This distinction is well brought about in a passage thus quoted in Permanent Edition of Words and Phrases, Vol. 26, from an American judgment. The passage runs thus :- Manufacture implies a change, but every change is not manufacture and yet every change of an article is the result of treatment, labour and manipulation. But something more is necessary and there must be transformation; a new and different article must emerge having a distinctive name, character or use. (Emphasis supplied by us) 21. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 23. Having considered the matter on the touchstone of the aforesaid legal position, we are of the view that the process of mixing polymers and additives with bitumen does not amount to manufacture. Both the lower authorities have found as a fact that the said process merely resulted in the improvement of quality of bitumen. Bitumen remained bitumen. There was no change in the characteristics or identity of bitumen and only its grade or quality was improved. The said process did not result in transformation of bitumen into a new product having a different identity, characteristic and use. 15. In the present case, we find that the imported Slack Wax, Residue Wax is in semi-solid form in drums. Foots Oil is part of Residue Wax or Slack Wax being lighter comes up on surface and siphoned by tilting the drums. The thinner Slack Wax called Foots Oil is thus separated. The pressure created by liquid through orifice for the purpose of exit is known as the hydraulic pressure. Basically, processed materials are emerging from the imported materials and the Revenue classified the processed material under the same Tariff Heading CTH. The Hon ble Supreme Court and the Tribunal in var ..... X X X X Extracts X X X X X X X X Extracts X X X X
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