Custom, Excise & Service Tax Tribunal
M/S. Madhav Marbles & Granites Ltd vs Cce, Salem on 7 June, 2017
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH, CHENNAI
E/544/2007
(Arising out of Order-in-Appeal No.46/2007-CE (SLM) dated 25.4.2007 passed by the Commissioner of Central Excise (Appeals), Salem)
M/s. Madhav Marbles & Granites Ltd. Appellant
Vs.
CCE, Salem Respondent
Appearance Ms. S. Sridevi, Advocate for the Appellant Shri L. Paneerselvam, AC (AR) for the Respondent CORAM Honble Ms. Sulekha Beevi C.S., Member (Judicial) Honble Shri Madhu Mohan Damodhar, Member (Technical) Date of Hearing / Decision: 07.06.2017 Final Order No. 40913 / 2017 Per Ms. Sulekha Beevi C.S. The issue that arises for consideration in this appeal is whether the imported resins used in the manufacture of polished granite is a raw material or consumable.
2. The appellant is an 100% EOU engaged in manufacture of polished granite slabs. They used resins imported avoiding duty exemption under Notification No. 8/97-CE dated 1.3.1997 in the manufacture of finished products and such products were cleared by them to DTA. Notification 8/97 provides exemption from payment of duty in respect of goods manufactured by 100% EOU and removed to DTA subject to the condition that the finished products are manufactured wholly from the raw materials produced or manufactured in India. The department was of the view that benefit of Notification 8/97-CE is not available to the goods manufactured to DTA. The proceedings initiated culminated in the confirmation of duty demand along with interest and penalties. Hence this appeal.
3. On behalf of the appellant, the learned counsel Ms. S. Sridevi submitted that the imported resins used in the manufacture of finished products were only consumables and not raw materials and therefore there is no violation of condition in Notification No.8/97. She relied upon the judgment in the case of Imperial Granites (P) Ltd. Vs. Commissioner of Customs & Central Excise, Tirupathi 2007 (218) ELT 618 (Tri. Bang.) and Gem Granites Vs. Commissioner of customs, Seaport (Import), Chennai 2007 (216) ELT 153 (Tri. Chennai).
4. The learned AR Shri L. Paneerselvam reiterated the findings in the impugned order.
5. Heard both sides.
6. The issue whether epoxy resins used by EOUs in the manufacture of granite slab is raw material or consumable is settled in the judgment cited by the appellants counsel. In Gem Granites (supra), the coordinate Bench of Tribunal has held as under:-
3.?After hearing both sides and considering their submissions, we find that, on a similar set of facts, the Tribunals co-ordinate Bench at Bangalore held, in the case of certain other EOUs, that the epoxy resins used by the EOUs in the manufacture of granite slabs out of indigenously procured granite blocks were not to be considered as raw material but only as consumables and, accordingly, the Bench allowed the benefit of Notification No. 8/97-C.E. dated 1-3-97 (predecessor to Notification No. 23/03-C.E.) to the EOUs vide Final Order Nos. 404-407/2007, dated 27-3-2007 in Appeal No. C/150/2006 etc. We find that, in the said final order, the Bench considered Notification No. 23/03-C.E. as well. It also took into account the Development Commissioners clarification which was to the effect that the resins used by EOUs in the polishing of granite blocks were only consumables. We are in full agreement with the view taken by the co-ordinate Bench. Accordingly, it is held that the appellants did not use any imported raw material in the manufacture of polished granite slabs during the material period and hence were eligible for the benefit of concessional rate of duty under Notification No. 23/03-C.E. ibid. The demand of duty is not sustainable. The impugned order is set aside and the appeal is allowed.
7. Following the proposition laid in the above cases, we hold that the imported resins being only consumables, the benefit of concessional rate of duty cannot be denied. The impugned order is set aside.. The appeal is allowed with consequential reliefs, if any.
(Operative portion of the order was
pronounced in open court)
(MADHU MOHAN DAMODHAR) (SULEKHA BEEVI C.S.)
Member (Technical) Member (Judicial)
Rex
3
E/544/2007