Case Law Details
Jindal Texofab Ltd. Vs C.C.E. (CESTAT Ahmedabad)
The main issue involved in the present appeals is whether M/s. JTL is liable to central excise duty in relation to finishing process of stentering of fabrics sent by M/s. Shrinathji Textiles and removal of such finished fabrics under the delivery slips to various parties from its premises. While denying the very activity having been carried out at its premise, it was the contention of the appellants before the authorities below that even if it is held that M/s. JTL carried out the process of stentering on fabrics sent by M/s. Shrinathji textiles, process of stentering does not amount to manufacture as such process do not bring about a change in the fabrics which is of lasting nature and no new or distinct goods thereby has come into existence. Learned commissioner (appeals) in the impugned order has held that although stentering of fabrics falling under chapter 52 does not amount to manufacture, however, since M/s. JTL was also carrying out other finishing processes specified under chapter note 3 to chapter 52 and stentering process in respect of fabrics falling under chapter 54 and 55 of the Central Excise Tariff Act, 1985; M/s. JTL is yet liable to duty.
In this regard, it can be seen that learned commissioner (appeals) (at para 9.8 of the impugned order) has relied upon the statement dated 05.06.2002 of Mr. Kailash S. Jalan, power of attorney holder of M/s. Shreenathji Textiles, in which he has stated that M/s. JTL has carried out process of stentering etc on the hand bleached/dyed/screen print fabrics sent by M/s. Shreenathji Textiles in the factory of M/s. JTL. However, on perusal of records (para 45 & 47 of the SCN) it transpires that it is not the case in the show cause notice that M/s. JTL carried out process other than stentering nor is there a specific case or evidence referred in the SCN that M/s. JTL carried out processes on the fabric falling under chapter 54 & 55 of CETA, 1985 which otherwise also do not specifically include stentering as a process amounting to manufacture. In absence of such a case in the SCN and in absence of evidence to show that M/s. JTL carried out process other than stentering of fabrics falling under chapter 52 or carried out process on the fabric falling under chapter 54 or 55, demand of duty as against M/s. JTL cannot be sustained.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
The present appeals are directed against Order-In-Appeal (OIA) No. AHM-EXCUS-001-APP-019 to 022/2022-23 dated 06-06-2022 passed by the Commissioner (Appeals) of Central Excise, Ahmedabad. M/s. Jindal Texo Fab Ltd (“M/s. JTL”) Plot o. 103-104, Phase I, GIDC, Vatva, Ahmedabad 382445 is the appellant upon whom the duty demand of Rs. 20, 07,924.04/- has been upheld under provisions of section 11A(4) of the Central Excise Act, 1944 (“Act”) along with equal penalty under section 11AC(1)(c) of the Act and Mr. Gyansingh Sisodiya is the Director of the appellant upon whom penalty of Rs. 5,00,000/- under Rule 26 of the Central Excise Rules, 2002 (erstwhile Rule 209A of the Central Excise Rules, 1944) has been upheld (referred to as “Appellants” herein after).
Please become a Premium member. If you are already a Premium member, login here to access the full content.
