PLASTRUSIONS Vs. CCE

JUDGEMENT

(1.) This appeal arises out of and is directed against the Order -in -Appeal dated 14.10.1998 passed by the Commissioner of Central Excise (Appeals), Bangalore.

(2.) Smt. Rukmani Menon appearing for the appellants submitted that the point to be considered in this case is whether cost of raw material is to be included in determining the value of clearances for claiming the exemption in terms of Notfn. 1/93. She said that during the financial years 1994 -95 and 1995 -96 the appellant manufactured polystyrene sheets on their own as well as undertook job work. The benefit of notification has been denied on the ground that for the job work undertaken they did not include cost of raw material in their aggregate turnover. She fairly conceded that if the cost of raw material had been included, they would have crossed the exemption limit of Rs. 3,00,000/ - in each financial year. She said that however the same was not to be included in terms of Notifications No. 83/94 and 84/94. She said that it was specifically mentioned in the Show Cause Notice since the supplier has not complied with the wordings of the terms and conditions of the said notification, then the party is not entitled for SSI exemption in terms of Notfn. 1/93. She said that since the goods are exempted, same were not to be included for claiming exemption in terms of Notfh. 83/94 and 84/94. Apart from the merits of the case, she said that demand is also barred by time. The Show Cause Notice was issued on 2.7.1997 for the period 1994 -1995 and 1995 -1996. In this context, she drew our attention to the Annexure -B wherein it was clearly shown the manufacturing value of Rs. 23,09,980.00 as well as labour charges of Rs. 12,48,807.00. She said that same was the position for the entire period and since the Department was aware of the factual position, it was the bounden duty of the Department to investigate and to raise demand within a reasonable time. She said that demand is clearly barred by time.

(3.) Shri Muneer Ahmed, appearing for the Revenue submits that to claim the exemption in terms of Notfn. 1/93, appellant should have included the cost of raw material supplied by the supplier to claim the exemption. The Department was just right in raising the demand. As regards the time bar issue, since the simple letter was filed indicating the figures it was not possible for the Department to probe into the matter. In this connection, he drew our attention to the finding given by the lower authority as can be seen from Para 15 of the Order.