D.C. Mandal, Member (T)

1. By the Miscellaneous application No. E/Misc./238/88-C the appellants have sought to introduce an affidavit dated 21-4-1988 of Shri Bhaskar Ramchandra Malevar as an additional evidence and have prayed for admitting the same as forming part of the records of the case. In this affidavit Shri Malevar has affirmed about the ingredients of Kajal manufactured by the appellants and the process, of manufacture of the said product. It also says that none of the ingredients loses Its identity during the process of mixture, which is not a chemical process but a physical process. Shri Doiphode arguing for the respondent has stated that the ground that there is no chemical transformation, was not raised before the lower authorities. In the review petition also they did not say so. The process of manufacture was also not stated before the Assistant Collector. Shri Doiphode has opposed the introduction of this new evidence at this stage. In support of his objection he has cited the authority of the Supreme Court judgment in the case of State of U.P. v. Manbodhan Lal Srivastava, reported in MANU/SC/0123/1957 : AIR 1957 S.C. 912. In the said judgment the Hon'ble Supreme Court observed that additional evidence should not be permitted at the appellate stage in order to enable one of the parties to remove certain lacuna in presenting its case at the proper stage, and to fill in gaps. It was also held therein that the Supreme Court would not permit additional evidence to be placed in appeal when there was sufficient opportunity for the appellant to place all the relevant matters before the High Court itself. Shri Pochkhanawalla has confirmed that the appellants did not raise the aforesaid point before the lower authorities. He has said that the Appeal before this Tribunal was filed on 19-2-1985 and the affidavit has been filed now because of subsequent decisions. We have considered this application and the arguments of both sides. Admittedly, the point that there was no chemical transformation of the ingredients into Kajal was not raised before the lower authorities. There was sufficient opportunity for the appellants to produce such an affidavit before the lower authorities, but they failed to do so. In the circumstances, following the Supreme Court judgment (Supra), this Miscellaneous application is to be dismissed. We order accordingly.

2. In this case, the appellants are manufacturers of kajal and kajal sticks falling under Item 68 of the Central Excise Tariff on behalf of M/s. Paramount Products on "job work" basis. Raw materials, viz. butter, vegetable black, camphor and preservatives, are supplied by the latter. Packing materials are also supplied by them. During the period from August 1980 to December 1980, the appellants cleared kajal and kajal sticks paying Central Excise duty on labour charges under Notification No. 119/75-C.E., dated 30-4-1975. The Range Superintendent of Central Excise issued a show cause notice on 11-2-1981 for recovery of short payment of duty amounting to Rs. 54,678.85 for the said period on the ground that the benefit of the above exemption notification was not admissible. The Assistant Collector of Central Excise, vide his Order-in-original No. V(68)4-2/81, dated 10-12-1981 confirmed the show cause notice and ordered recovery of the differential duty of Rs. 54,678.85 stating that the raw materials, viz. butter, vegetable black, camphor and preservatives, had undergone drastic change chemically and physically, that the finished product was absolutely different from the raw materials and there was complete transformation of the raw materials into a new and distinct finished product and that the classification list No. 3/80 stood approved without extending the benefit of Notification No. 119/75-C.E. Aggrieved by the above order of the Assistant Collector, the appellants filed a review petition under Section 35A of the Central Excises and Salt Act, 1944, as it then existed, before the Col