M/S Complete Surveying Technologies P. ... vs Cce, Noida

[Arising out of the Order-in-Appeal No. 115/CE/APPL/NOIDA/ 2006 dated 28/07/2006 passed by The Commissioner (Appeals), Customs & Central Excise, Noida.]

For Approval and signature :

Honble Shri Ashok Jindal, Member (Judicial)

Honble Shri B. Ravichandran, Member (Technical)

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 would 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 :

Department Authorities?

M/s Complete Surveying Technologies P. Ltd. Appellant

Versus

CCE, Noida Respondent

Appearance

Shri R. Sudhinder, Advocate  for the appellant.

Shri R.K. Grover, Authorized Representative (DR)  for the Respondent.

CORAM: Honble Shri Ashok Jindal, Member (Judicial)

Honble Shri B. Ravichandran, Member (Technical)

Final Order No. 52239/2015 Dated : 13/07/2015

Per. B. Ravichandran :-

The appellant is a 100% EOU engaged in the manufacture of tripods using aluminium ingots as raw material procured indigenously and by import. The Central Excise officers on verification of records found that the appellant had cleared tripod/aluminium dust and slag in DTA availing Notification No. 8/97-CE dated 01/3/97 which is available if the said goods are manufactured wholly out of indigenous raw material. Since the appellant did not maintain separate records of imported/ indigenous source of raw materials proceedings were initiated which resulted in the order dated 31/01/2006 by the Deputy Commissioner, Central Excise Division IV, Noida. The Original Authority confirmed the demand of Rs. 26,493/- short paid during the period from 08/01/2004 to 15/12/2004. On appeal, the order was confirmed by learned Commissioner (Appeals) vide order dated 28/07/2006 except for recalculation of duty liability based on reduction in basic customs duty.

2. The appellant is in appeal against the above order of learned Commissioner (Appeals). They pleaded that the rejected tripods valued at Rs. 87,350/- were manufactured prior to first import of aluminium ingots on 13/01/2004. As there were no imports prior to that date all raw materials used were indigenous only in respect of rejected tripods manufactured prior to 23/05/2003. These were returned rejected stock from the foreign buyer. Hence it is apparent the tripods cleared in DTA were eligible for Notification No. 8/97-CE.

3. Regarding aluminium dust and slag the appellant pleaded that these were dross and skimming of aluminium taken out of molten aluminium as floating dust during the course of manufacture. As per Honble Supreme Court judgment in the case of Union of India vs. Indian Aluminium Co. Ltd. reported in 1995 (77) E.L.T. 268 (S.C.) these are not excisable commodity. Hence the question of paying differential duty does not arise.

4. Learned AR reiterated the findings of the lower authority and stated as the appellant did not maintain separate account of usage of raw material (indigenous or imported) they are not eligible for the concession claimed as per Notification No. 8/97-CE.

5. Heard both the sides. Considered their submissions.

6. The admitted fact is that the appellant did not maintain separate accounts of raw material during the period. The appellant were admittedly clearing a very small portion of the production (less than 1%) in DTA. It is seen that the tripods cleared in DTA have suffered only concessional rate of duty on the ground that they were made out of indigenous raw material only. It is established by the appellant that they had no imports of raw material prior to 13/01/2004. The goods for DTA clearances now subject matter of dispute were made prior to that date. The demand for differential duty were sustained only on the ground that no separate accounts were maintained and the appellant failed to establish that the said items were manufactured only out of indigenous raw material. Considering the facts now pleaded by the appellant it is clear that no differential duty can be demanded as there was no import of raw materials prior to the date of manufacture of goods later cleared to DTA. These were earlier rejected/returned tripods.

7. Regarding duty liability on aluminium dust and slag, we agree with the contention of the appellant that these are not excisable commodities as they arise as dross and skimming during the course of manufacture. The Honble Supreme Court decision in the case of Union of India vs. Indian Aluminium Co. Ltd. (supra) is relied upon. Though the appellant pleaded these grounds before the lower authority no findings were given except the observation that the same is not subject matter of the instance case as the appellant themselves paid the duty without insistence by the Department. However, in the order duty on tripods and aluminium dust and slag was confirmed by the Original Authority.

8. Considering the above findings, we allow the appeal with the consequential relief, if any.

(Operative part of the order pronounced in the open court.)

(Ashok Jindal)

Member (Judicial)

(B. Ravichandran)

Member (Technical)

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