Customs, Excise and Gold Tribunal - Delhi
A.Z. Metal Industries Pvt. Ltd. vs Collector Of Central Excise on 7 March, 1991
Equivalent citations: 1992(62)ELT724(TRI-DEL)
ORDER K.S. Venkataramani, Member (T)
1. This is an appeal against the order dated 25-7-1989 passed by the Additional Collector of Central Excise, Bombay-II. The appellants, herein, manufacture aluminium collapsible tubes falling under erstwhile T.I. 27 CET. They cleared the tubes fitted with plastic caps and discharged duty liability on tubes only and not on the tubes fitted with caps. The Department initiated proceedings against them by issue of Show Cause Notice dated 1-10-1985 for recovery of duty short paid on value of caps cleared alongwith the tubes for the period 1-10-1983 to 30-9-1985 under Section 11A of the Central Excises & Salt Act, 1944 and the Additional Collector, on considering their defence, confirmed the demand but confined it to the 6 months period under Section 11A holding that as there was no suppression of facts, the longer period under that Section cannot be invoked. Shri D.K. Subedar, Ld. Counsel appearing for the appellants, submitted that the issue now stands settled by the Supreme Court decision as reported in 1990 (45) E.L.T. A33 in the case of C.C.E. v. Metal Box India in which Supreme Court had affirmed the decision of the CEGAT reported in 1983 (13) E.L.T. 956 that fitting of caps to tubes is not manufacture and that aluminium tubes are liable to duty without the plastic caps because these are manufactured separately. The show cause notice was also assailed as it did not quantify the duty demanded. The plastic caps arc generally supplied by the customers. He also relied upon the case of Extrusion Processors Pvt. Ltd. and Ors. v. Union of India and Anr. reported in 1987 (31) E.L.T. 866 (Bom.) decided by the Bombay High Court saying even after the amendment of Tariff Item in 1980 and even after the Supreme Court decision in Bombay Tyre International case, caps and capping charges are not includible in the assessable value. Shri Satish Kumar, Ld. D.R. contended that caps are integral parts of the collapsible tubes and in this view of the matter their cost has to be included in the assessable value. On a careful consideration of the submissions made, it is seen that the case of Metal Box India decided by this Tribunal was also one where the Department sought to recover duty on plastic caps attached to collapsible tubes although the caps were not manufactured by the appellants therein. The Tribunal considered the scope of Tariff Item 27 CET with the Explanation thereto regarding 'containers' and held that even without the plastic cap the aluminium collapsible tube remains the same and will satisfy the tariff description 'containers' under Item 27 with its Explanation, and that further the caps have to be treated separately while charging duty on aluminium as envisaged under Item 27 C.E.T. We also find that as reported in (supra) the Supreme Court dismissed the appeal against this decision of the CEGAT observing, "We have considered the facts and heard the Ld. Lawyers. We find no merit in this appeal. The appeal is dismissed." In view of the position so settled, in the present case also, the demand raised against the appellants on the ground that they had discharged duty liability under Item 27 CET only on the aluminium collapsible tubes, and not on the tubes fitted with caps, is not sustainable. The impunged order is, therefore, set aside and the appeal allowed.