ACQUA PUMP INDUSTRIES Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) THIS appeal arises from the Order in -Original No. 44/91, dated 13 -5 -1991 passed by the Additional Collector of Central Excise confirming duty demand of Rs. 1,42,333.93 under Rule 9(2) of the CE Rules read with Section 11A besides imposing penalty of Rs. 2,000/ - on the appellants in terms of Rule 9(2), 173Q and 226 of the CE. Rules, 1944.

(2.) APPELLANTS were alleged to have manufactured and cleared Die Cast Rotors falling under Heading 8503.00 without payment of duty, without following any procedure and suppressed the fact of the said manufacture and clearance from the department. The appellants contended that this Die Cast Rotors were used in the manufacture of Mono Block Pumps in terms of Notification No. 142/88, dated 18 -4 -1988.

(3.) THE Chartered Accountant appearing for the appellants submits that the benefit of exemption Notification cannot be denied to the appellants on the sole ground that they did not follow the Chapter X procedure. He submits that non following the Chapter X procedure is only a procedural lapse and not substantive and therefore, the substantive benefit contained in the Notification cannot be denied to them. He also relied upon the ruling of the CEGAT in the case of Mahindra and Mahindra v. C.C.E. as reported in 1999 (31) RLT 257. He submits in this judgment, large number of judgments have been cited including the judgment of Hon'ble Supreme Court on this point in the case of Thermex Pvt. Ltd. v. CC as reported in 1992 (61) E.L.T. 352 (S.C). He also cites the judgment in the case of Kamal Cold Storage Pvt. Ltd. as reported in 1987 (31) E.L.T. 754 which has been distinguished by the Bench and has clearly held that this judgment and the judgment in the case of Agrico Engg. Works v. CCE as reported in 1994 (72) E.L.T. 689 are no longer relevant in view of the Supreme Court judgment in the case of J.K. Synthetics Ltd. as reported in 1996 (87) E.L.T. 582. The Hon'ble Supreme Court further clarified that the benefit of exemption notification is available and the concession should be granted in case the intended use of material can be established by the importer or by evidence. He submits that there was no dispute about the intended use of the material in the Mono Block Pumps and hence non grant of benefit is not correct and the impugned order needs to be set aside.