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TMI Blog2001 (10) TMI 204X X X X Extracts X X X X X X X X Extracts X X X X ..... posing addition of extra amount realised from the dealers to the assessable value for the recovery of differential duty due to change in the value of assessment arising out of realisation of additional amount from the dealers in respect of decorated glassware. Duty demand of Rs. 8,01,132.85 was proposed to be recovered. Further allegation in the show cause notice was that the appellant had wrongly classified products such as single neck spherical vessels and multi neck vessels of 50 litres capacity and buttress ends under CETA sub-heading 7015.00 instead of Chapter Headings 70.07 and 70.01 respectively and on this ground duty of Rs. 2,65,791.80 was proposed to be recovered for the period 1-1-1998 to 27-2-1999. 2. The appellants filed reply to the show cause notice on 25-5-1999 explaining that plain glassware like drinking glasses were cleared from their factory premises on payment of appropriate duty. Assessable value of plain glasses were declared on the basis of the price charged in respect of plain glass sold from depots and some of the plain glasses which were removed from the factory on payment of duty were sent to job workers who carried out the process of decoration and re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther the identity of the original commodity ceased to exist, and, secondly whether the commodity which was already in existence will serve no purpose or will be of no commercial use but for the said process. Applying the twin tests set out above we find, first that the identity of the original commodity, namely plain glasses continues and it has not ceased to exist. Secondly, plain glasses will serve the same purpose namely, of holding water or other liquids as that to be served by the decorated glasses. In fact the show cause notice, adjudication order and the impugned order do not proceed on the basis that the process of decoration carried out by the job workers on the plain glasses manufactured by the appellants amounts to manufacture. The grounds on which it proposes to add the cost of decoration to the assessable value of the glasses is that the extra charges collected by the assessees over and above the invoice value collected from dealers through sales invoices issued from depots is to be included in the light of the amended definition of "place of removal" in Section 4(4)(b) of the Central Excise Act. Let us examine this. Prior to amendment of Section 4(4)(b) the definition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are removed from depot, such goods are to be valued with reference to the time when it was removed from the factory. Looking on it from another angle the price at which the decorated glasses are sold at depot gate cannot be applied to plain glasses removed from the factory gate for the reason that the goods are different and are not "such goods" for the purpose of determining the assessable goods in terms of Section 4(1)(a). In the case of Savita Chemicals Ltd. v. CCE, Mumbai-VI [2000 (119) E.L.T. 394] the Tribunal held that the price at which containerised goods are sold form the depot gate cannot be applied to bulk oil cleared from the factory gate to the depots and that the factory gate price has to be adopted. Since oil cleared in bulk cannot be even comparable with oil packed in containers of smaller tanks, let alone to be treated as "such goods" for the purpose of arriving at assessable value in terms of Section 4(1)(a) which provides that where excise duty is chargeable on any excisable goods with reference to value, such value shall be deemed to be the normal price thereof, i.e., to say the price at which such goods are ordinarily sole by the assessee to a buyer in the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tchen, office, indoor decoration or similar purpose (other than that of Heading 70.07 or 70.13)" is to be approved and accordingly uphold their contention and set aside their classification under Heading 70.07. 9. Issue No : 3 - Classification of Buttress Ends : Right from the beginning the appellants' stand is that the buttress ends are not unworked rods or tubes so as to attract classification under Heading 70.01. They have explained the process of manufacture in Annexure IV to the reply to the show cause notice as under : "The sizes 25 mm, 40 mm and 80 mm buttress ends are made from tubing. Tubing of the required diameter is taken and cut to the required sizes. It is then heated at one end and melted. The process is generally done on a lathe. The molten portion is then pressed by means of special tools and the required shape of the buttress ends is formed on the tube and then it is annealed." "Buttress ends of sizes 100 mm and 150 mm are manufactured by pressing process. The molten glass from the furnace which is around 1600°C is collected by means of a robot or manually by using a rod. The collected glass is taken out of the furnace and then cut and dropped into a mould b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and flat bottom cylinders are produced by the mouth blown process has not been disputed by the Revenue. In fact the second noticee in his statement recorded on 12-3-1999 has stated that 50 litre vessels and cylinders are mouth blown and the notice does not rebut the same but accepts that these two are mouth blown vessels. Therefore, although we have held that duty was correctly paid on these items under Heading 70.15 by the appellants we further hold that the benefit of concessional rate of duty @ 8% under Notification 5/98 is available to them. 12. Issue No. 5 - Whether the demand is barred by limitation : The appellants contend that the demand of 8,01,132.85 on decorated glassware is entirely barred by limitation since the period covered i.e. 28-9-1996 to 30-6-1998 is entirely beyond the period of 6 months from the date of issue of the show cause notice i.e., 31-3-1999 and that the demand in respect of the other disputed products is partly time barred since the period is 1-1-1998 to 27-2-1999 while the show cause notice dated is 31-3-1999. The authorities below have relied upon the provisions of Section 110 of the Central Excise Act, 1944 to hold that the demand can be raised ..... X X X X Extracts X X X X X X X X Extracts X X X X
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