Customs, Excise and Gold Tribunal - Mumbai
Collector Of C. Ex. And Customs vs Meta Dust (India) Pvt. Ltd. on 6 October, 1995
Equivalent citations: 1996(82)ELT481(TRI-MUMBAI)
ORDER R. Jayaraman, Member (T)
1. The Reference application has been moved by the Collector in this respect of this Bench order No. 993/994/94/WRB, dated 30-5-1994. The issue which was considered in the appeal before the Tribunal was, whether 'crucible' which was used for melting zinc for manufacture of zinc dust would be eligible for Modvat credit under Rule 57A of the Central Excise Rules and whether the demand issued for reversal of credit would be hit by time bar. This Bench construed 'crucibles', to be an equipment for melting and since it is excluded from the purview of modvat credit under Rule 57A, it was held by the Tribunal that it is not eligible for modvat credit. All the same, taking note of the declaration made and also taking note of the fact that the demand has been issued beyond a period of six months, it was held that the demand is hit by time bar. The Collector is aggrieved by the order only with regard to the setting aside of the demand as hit by time bar. The ground urged in the reference application by the Collector is that the 'crucibles' is declared as a component in the declaration. This is a misleading declaration. It is not indicated that crucible is an equipment. Hence, the Tribunal has erred in holding that what is obvious need not be declared and hence set aside the demand on the ground of time bar. It is not expected on the Departmental officers to know all the detailed process of manufacture and to comprehend on the basis of the declaration, whether it is a component of the final product or a component of the machinery or an equipment by itself. Hence, reference application has to be allowed.
2. Shri Krishnamoorthy, the Id. JDR, appearing for the Department, reiterated the grounds and pleads that crucible is an equipment for melting the metal. It is declared as component with a view to deliberatly mislead the Department. The Departmental Officers cannot be expected to know whether it is a component of the final product or a component of the machinery. Hence, the extended period would be applicable. The Tribunal seems to have erred in appreciating this factual position which also involves legal interpretation. It is a mixed question of law and facts. Hence, it would call for a reference.
3. After hearing both the sides, I again had a look into the declaration made. The declaration has been filed in the prescribed proforma. They have declared the final product as zinc dust/powder flakes. They have declared the following inputs :
(i) Unwrought zinc in any form including blocks, plates, ingots etc. raw material
(ii) Zinc waste/scrap - raw material
(iii) Crucibles - component
(iv) Tanks, casks, drums, cans, container boxes etc. - packing material.
(v) Zinc dust - finished products (rejected materials received for remade, repair, re-condition or reprocess).
4. This declaration indicating the final product as zinc dust/powder/ flakes can only have the raw material unwrought zinc in any form or zinc waste or scrap. If they had declared 'crucibles' as component, it is because the heading only indicates 'nature of inputs, whether raw material component, packing material, catalyst, solvent etc. They have declared it as component for the machine for melting of these ingots. In the absence of any prescribed column for indicating the 'component for machinery' the declaration appears to have been given as component. Hence, deliberate misdeclaration cannot be alleged even going by the proforma of declaration. Be that as it may, when the final product is zinc dust/powder flakes, even a lay person not endowed with any technical knowledge, but knowing the meaning of the word 'crucibles', could not envisage that crucibles would be forming a component part of zinc dust or powder or flakes. I am unable to pursuade myself to accept that the Departmental officers of the rank of the Asstt. Collector or Supdt. could be ignorant of the meaning for 'crucibles' and he would have been misguided to believe that crucibles are a component of zinc dust/powder flakes. That is why this Bench observed that what is obvious need not be declared. Here it is obvious that crucibles can only be a component of the machinery and cannot be component of zinc dust/powder flakes. If the Department have not taken any proper action for raising the demand within a period of six months, they have to blame themselves. There is neither any question of law nor a mixed question of fact and law arising in this case. Hence, the reference application is dismissed.