IPCA Laboratories Ltd Vs C.C.E. & S.T. (CESTAT Ahmedabad)
CESTAT find that the dispute relates to demand of duty on the semi-finished goods/ work in process goods during the debonding of EOU. We find that as per the details submitted by the appellant which is not in dispute, the semi-finished goods/ work in process was not in fully manufactured form and the same was at different stages of the manufacturing process. The said goods are not marketable as such which were subjected to various other processes to attain the stage of final product, therefore, at the semi-finished stage, where no excisable goods came into existence, the demand of duty at the time of debonding is, in our view, incorrect in law. In any case, these semi-finished goods/ work in process will reach to the stage of final product and the same is liable for duty at the time of clearance from the factory. Therefore, at the intermediate stage when the goods are not fully manufactured, the excise duty was not payable at the time of debonding, particularly when the goods were not cleared from the factory and were in the process of manufacturing. This issue is no longer res integra as the same stand decided by CESTAT Bangalore in the case of Tirumala Seung Han Textiles Ltd. (supra) Wherein the following order was passed.
