COSMO FERRITES LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) APPEAL No. E/3648/2006 has been filed by Cosmo Ferrites Ltd. against Order -in -Appeal No. 814/CE/CHD/2006, dated 6 -9 -2006 and Appeal Nos. E/2758/2007 & E/334/2008 by the Revenue against Order -in -Appeal Nos. 283/CE/CHD/07, dated 23 -7 -2007 and 700/CE/CHD/07, dated 7 -12 -2007, respectively. In the Order -in -Appeal dated 6 -9 -2006 duty has been confirmed against Cosmo Ferrites Ltd. and the assessee is in appeal against it. In the Orders -in -Appeal dated 23 -7 -2007 and 7 -12 -2007 demands have been dropped by the Commissioner (Appeals) and Revenue is against that. As issues involved is common all the Appeals are taken together for disposal. Facts of the case are briefly explained. Assessee was a manufacturer of Soft ferrite powder and Soft Ferrite Components. Their factory was situated in Solan H.P. for the manufacture of the said products. They imported raw materials ferric oxide, manganous manganic oxide, manganous oxide, polyvinyl alcohol and polyethylene at concessional rate of duty under exemption Notification No. 25/99 -Customs, dated 28 -2 -1999 (S. Nos. 17 & 54 of Part A of the Notification). For this purpose, they had duly executed Bond with the Assistant Commissioner of Customs & Central Excise Shimla H.P. under Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996. Impugned raw materials have been imported by filing Bills of Entry with the Assistant Commissioner of Customs at Mumbai. Due intimation regarding their being registered under Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 was sent by the Assistant Commissioner Shimla to the Assistant Commissioner Customs Mumbai. Based on that information, the impugned raw materials were cleared at concessional rate of duty by the Assistant Commissioner Mumbai under the above said exemption notification. The impugned raw materials were duly accounted for in their statutory Central Excise records and manufacturing of the intended final products was duly certified by the jurisdictional Central Excise officers.

(2.) THE demand arose for the reasons that subsequently Revenue felt that the assessee was not entitled for concessional rate of duty for import of the said raw materials under the impugned exemption notification inasmuch as the said raw materials were not eligible for exemption under the said S. No. (17 and 54) of the Notification as the said S. Nos. covered the finished goods 'Ferrites' and not Soft Ferrites or Ferrite powder whereas these final products were, instead, properly covered under S. No. 148 of the same exemption notification. This S. No. 148 of the exemption notification is specifically for Pre -calcined Ferrite Powder but did not cover the impugned raw materials imported by the assessee. Therefore Revenue holds that the impugned raw materials were not eligible for exemption under impugned Notification No. 25/99 -Cus.

(3.) ON limitation, the ld. Counsel submitted that the entire matter was in the knowledge of the Revenue and the exemption was availed with due approval of the Assistant Commissioner, Shimla; that therefore Revenue could not allege any suppression of facts on part of the assessee. On the merits of the case, he submitted that 'Ferrites' includes Soft Ferrites and Ferrite Powder as these were only intermediate products for manufacture of Ferrites; that the notification did not differentiate between Soft Ferrites and Ferrites as claimed by the Revenue and therefore S. No. 17 and 54 of the impugned notification would cover Ferrite in any form i.e. Powder Soft (Pre Calcined) Ferrites and Calcined Ferrites.