9911796707
TMI Blog2004 (6) TMI 137X X X X Extracts X X X X X X X X Extracts X X X X ..... effect from 1-3-2001 the duty became leviable under provisions of Section 3 of the Central Excise Act on ad valorem basis; that the Revenue has demanded Central Excise duty and imposed penalty in respect of stock of 84,407.50 mts. with them as on 1-3-2001 treating them as unfinished fabrics. The learned Advocate, further submitted that the duty under Section 3A of the Central Excise Act is with reference to the factory and not with reference to the stage at which the goods attained finality after passing through the activity carried on by the factory; that further Notification No. 19/2000-Central Excise, dated 1-3-2000 specifies the rate of duty in respect of processed textile fabrics manufactured or produced by an independent processor wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T. T10] wherein it has been clarified that in respect of processed textile fabrics manufactured prior to 1-3-2001, since duty liability would have been discharged by 28-2-2001, on compounded levy basis, there is no further duty liability even if such fabrics are cleared on or after 1-3-2001 provided the duty liability has been discharged by 28-2-2001. Learned Advocate contended that as the impugned fabrics had been processed by them before 1-3-2001 and the duty had been discharged by them during the month of February, 2001, and as the ad valorem duty came into effect on 1-3-2000 only, the same cannot be applied to the goods manufactured prior to that date. 3. Countering the arguments Shri O.P. Arora, ld. SDR submitted that the impugned f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n processed or not; that all the processes have been undertaken by them and therefore the fabrics in question was processed one and as such no duty is payable by them. 5. We have considered the submissions of both the sides. Processed Textile fabrics falling under specific headings of the Schedule to the Central Excise Tariff Act were notified under Section 3A of the Central Excise Act whereby the duty on the specified processed textile fabrics was leviable on the basis of annual capacity of production as determined by the competent authority. The amount of duty was required to be paid by the fifth of each calendar month. It is the contention of the appellants that they had processed the fabrics in the month of February, 2001 and had disc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an that the duty was leviable immediately after the textile fabrics has undergone the process with the aid of hot air stenter. The duty is imposed on the processed textile fabrics. Unless and until all the fabrics is ready after carrying out all the required processes, it cannot be regarded as processed textile fabrics. As admittedly the process of decatizing and folding have not been undertaken on the fabrics in question by 28-2-2001, the said fabrics cannot be said to have suffered the duty under Section 3A of the Central Excise Act. We, therefore, uphold the demand of duty as confirmed in the impugned order. As far as imposition of penalty on the appellants is concerned, we are of the view that the issue involved is being one of the inte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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