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TMI Blog2019 (6) TMI 260X X X X Extracts X X X X X X X X Extracts X X X X ..... 1995 which ordered for its winding up. The official liquidator on 11/03/2003 called for offers for sale of property and assets for M/s GNAL and affixed terms and conditions. In the auction proceedings, the appellants have herein participated in the auction and the appellant being the highest bidder, the properties of the said company were sold to the appellant for the price of Rs. 5.41 crores and this sale was also confirmed by the Hon'ble Gujarat High Court vide order dated 09/05/2003. The Range Superintendent vide letter 11/08/2003, wrote a letter to the Official Liquidator with a copy thereof to the appellant stating therein that land, building, plant and machinery etc. of the said company were confiscated by Central Excise Authorities a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thereupon the appellant was permitted to remove the goods to that extent. During the period from 18.12.2003 to 26.10.2005, the appellant removed and sold the old, used, discarded and unserviceable parts, components, scrap, etc. in 42 bills which were issued from 06.06.2003 to 07.08.2003 and therefore, sales were made vide Bill No. 51 to 371 from 18.12.2003 to 26.10.2005. The Assistant Commissioner of Central Excise issued a Show Cause Notice dated 02.12.2005 and proposed to demand and recovery of Central Excise duty of Rs. 5 lakhs under the proviso to section 11A(1) of the Central Excise Act, 1944 with interest and also penalty under Rule 25 of the Central Excise Rule, 2002. Another Show Cause Notice dated 15/05/2008 was issued by the Res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant submits that the demand was raised against the appellant construing them as a manufacturer. He submits that appellants have purchased the goods in auction and they have cleared the said goods either as such or after dismantling the same. Their activity does not amount to manufacture. Therefore, the goods so purchased in auction and sold, the appellant is not liable for any Excise duty. The appellant have sold the goods as waste and scrap. The duty on waste and scrap can be demanded only if such waste has arisen during course of manufacturing activity of excisable goods which is not the case here, as appellant is only a purchaser of goods in auction and seller of the same. He submits that this issue has come up before the Tribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dictional Asst. Commissioner vide show cause notice dated 02/12/2005 also proposed to encash the bank guarantee furnished by the appellant on the ground that dismantling of goods were liable to duty and hence in the interest of Revenue the bank guarantee should be encashed. All these facts were already in the knowledge of the department that the appellant is clearing the dismantled waste and scrap subsequent to the auction with the plea that the appellant suppressed that fact from the department is misconceived. Therefore, the extended period of limitation cannot be invoked. As regard the redemption fine, he submits that since the goods were not available for confiscation, redemption fine cannot be imposed. He placed reliance on the followi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods in auction, the department is free to settle their excise duty with Official Liquidator and not from the appellant. It is also not the case of the department that dismantling of capital goods is amount to manufacture. Therefore, there is no basis in the department's proceedings to demand any Excise Duty from the appellant. As per the judgments cited by Ld. Counsel on behalf of the appellant it is settled that merely sale of parts by dismantling any capital goods is not liable for excise duty. As regard limitation, we find that the entire facts of purchase of goods under auction and sale thereof were well within the knowledge of the department. Therefore, the department if at all was of the view that any duty liability arise, they wer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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