C.C.E. Bhopal vs Shri M.S. Negi, Dr For The

[Arising out of Order-in-Original No. 06/Commr/CEX/2006 dated 31.08.2006 by the Commissioner of Customs, Central Excise & Service Tax (Appeals), Bhopal].

For approval and signature:

Honble Shri Ashok Jindal, Member (Judicial)

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether Their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

M/s. Narmada Gelatines Ltd. .Respondent

Vs.

C.C.E. Bhopal .Appellants

Appearance:

Shri Vipul Agarwal, Advocate for the Appellant

Shri M.S. Negi, DR for the Respondent

CORAM:

Hon'ble Shri Ashok Jindal, Member (Judicial)

Hon'ble Shri B. Ravichandran, Member (Technical)

Date of Hearing: 10.07.2015

FINAL ORDER NO. 52238/2015-EX(DB)

Per Ashok Jindal:

After hearing both sides, we find that the demand stand confirmed against the appellant in terms of provisions of 6(3)(b) on the ground that during the course of manufacture of their final product gelatine, ossein emerges and Hazardous mother liquor emerges which is further processed to manufacture di-calcium phosphate and enriched Di-calcium phosphate which is exempted. Inasmuch as the appellants have not maintained separate accounts for the credit availed on the inputs used both in dutiable as also in exempted products, they were held liable to pay 8% of the value of their final exempted product cleared during the period from July 2005-Dec 2005.

2. We note that prior to present proceedings, the proceedings were initiated against the appellant for the earlier period making the same allegations which were upheld by the lower authorities. The matter came up before Tribunal, and vide their order dated 4.11.2008 reported as Narmada Gelatines Ltd. Vs. CCE, Bhopal [2009 (233) ELT 332 (Tri-Del)], it was held that di-calcium phosphate and enriched di-calcium phosphate are by products which emerged during the process of manufacture of gelatine their final product. As such, the provisions of Rule 6(3)(b) are not applicable. Apart from the above, learned advocate also draws our attention to Mumbai High Court decision in Rallis India Ltd. Vs. Union of India [2009 (233) ELT 301 (Bom)] wherein in similar circumstances, the same products were held to be by-product, thus not attracting the legal provisions for payment of same as 10% of value of final products.

3. Inasmuch as the issue stand decided by Mumbai High Court as also by the Tribunal in appellants own case, we set aside the impugned order and allow the appeal with consequential relief to the appellant.

4. Considering the fact that in appellants own case for earlier period vide Final Order No.A/FO/55220/2013-EX(BR) dated 11.01.2013, the issue was settled in favour of the appellant wherein it has been held that the product in question are by product and not attracting any legal provision and payment of amount equal to 10% of the value of final product.

5. In these circumstances, we set aside the impugned order and allow the appeal with consequential relief if any.

(Dictated and pronounced in the open court)

(B. Ravichandran) (Ashok Jindal) Member (Technical) Member (Judicial)

Bhanu

2

E/3360/2006-EX(DB)