JUDGMENT
Gowri Shankar, Member (Technical)
1. Appeal is taken up for disposal with consent after waiving deposit.
2. In the order impugned in this appeal, the Commissioner (Appeals) has confirmed the liability to duty as determined by the Additional Commissioner’s order on quantities of N-Hexane and derived cixon which he finds manufactured by the appellant and cleared on payment of duty and penalty imposed on it.
3. Counsel for the appellant states that he finds that during the relevant period it received from Indian Petrochemicals Corporation, Vadodara quantities of cixon that arose in its factory under the provision of Sub-rule (4) of Rule 57F. It isolated the N-hexane from this product and sent back this commodity as well as the remnant of the cixon technically as returned stream to IPCL to clear these product after paying duty. He accepts that the finding of the authorities that during the relevant time April and July 1999 cixon was not specified as an input to the table to the notification 21/99 dated 28.2.97. He contends however that cixon that was sent to the appellant was not an input by the by-product. He next contends since the duty has been discharged by the IPCL there is no question of payment against having to pay duty. He cites the decision of Suvarna Fibrotech (P) Ltd. v. CCE 2000 (120) ELT 141 and Hitech Diecast Pvt. Ltd. v. CCE Coimbatore 2003 (55) RLT 691. The notice issued by the Superintendent is without jurisdiction as it invokes the provision of 11AC of the Act. He finally contends that in any event, duty is only payable on the hexane since no duty is payable on the cixon on the quantities that returned since it received and manufactured.
4. We are not able to accept any of the argument but the last. The contention that cixon is a by-product and not input is difficult to understand. Sub-rule (4) of Rule 57F provides for partially processed inputs to be sent to another factory for the purpose specified therein. The notification 21/99 specifies in Clause (a) the inputs and (b) the final products. Heading 2710.19 in which the cixon undisputably falls is specifically excluded. It was therefore not an input and the benefit of Sub-rule (2) of Rule 57F would not be available. The fact that duty has been paid to the IPCL does not appear to us to be relevant. Rule 7 of the Central Excise Rules requiring payment of duty by the manufacturer. This point does not appear to have been raised that the two decision counsel for the applicant cites. It proceeds on the basis that 57F was not substance available and had been relying on procedural infraction or failure. In this case, the objection case deeper that procedure. The goods not specified, as input there was no question of the provision of Rule 57F(4) be extended to him. Nor is it possible to accept that he the notice is without jurisdiction if the extended period proviso under Sub-rule (1) of Rule 11A it would have to be issued by the Commissioner. It does not do so. The mere fact that it refers to 11AC of the Act in conjunction with Rule 173Q (the exact words of read with Section 11AC) does not refer to that the extended period invoked. No doubt these words have been employed because confiscation under 11AC is “subject to Rule 173Q”. We however find some merit in the last argument that no duty could be levied on the quantities of cixon and that he appellant received and returned. The Additional Commissioner has refuted this argument by saying that the cixon and the “derived cixon” was different from the cixon that the appellant received. Neither side submitted technical information about the cixon that was sent and that was returned in order for us to say that they were the same or not. We however think that this point requires examination. If the technical chemical structure and other characteristic of the cixon was received and returned and it is only held t hat there was no manufacture for this product. For this purpose only, we remand the matter to the Additional Commissioner. He shall pass orders on the limited aspect after considering materials.