A Two-Member Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ), Chennai Bench confirmed penalty and observed that the Machine dipped match splints attracts excise duty.
The appellants in the present matter are M/s. Innasimuthu Package, M/s. Maheswari Match Works, M/s. Anusuya Match Works.
In the appeals, the issue relates to applicability of exemption Notification No. 4/2006-CE dated 1.3.2006 at Sl. No. 72 which deals with the matches classifiable under Chapter 3605.00.10 or 3605.00.90 of the Central Excise Act, 1944.
In terms of the above notification, the rate of duty is nil if no power is used, in any event, in anyone or more processes viz. frame filling, dipping, filling of boxes, pasting of labels or packing.
Chapter 36050010 or 36050090 of the Central Excise Act, 1944 gives the description of excisable goods as Matches or in relation to the manufacture of which none of the following processes is ordinarily carried on with the aid of power namely: -i) Frame filling ii) Dipping of splints in the composition for match iii) heads filling of boxes with matches iv) pasting to labels on match boxes, veneers or card boards; v) Packaging.
The Counsel M. Kannan appeared and argued for the appellants and was submitted that the appellants are independent manufactures. They purchased ‘machine dipped match splints’ and undertook box filling and packaging without the aid of power and then cleared at nil rate of duty. The department has issued the Show Cause Notices proposing to deny the benefit of Notification No. 4/2006-CE dated 1.3.2006.
The Counsel submitted that the issue has been settled by the decision of the in the case of Sri Ganapathy Packing Vs. Commissioner of GST and Central Excise.
The Tribunal in the above-mentioned case noted that “There are also references to many Circulars/Notifications by Member (Judicial), but as is well known, each Notification/ Circular is issued in particular circumstances, in respect of particular areas or sectors, with particular intentions. I am of the view that we must be circumspect in determining their analogous applicability to other circumstances. One size does not fit all. There can be no generality.”
The Tribunal of Sulekha Beevi C.S., Member (Judicial) and M. Ajit Kumar, Member (Technical) concluded by noting that “We hold that the appellant is not eligible for the benefit of exemption of the Notification.”
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