S.D. Jha (J) and K.P. Anand (T), Members

1. The questions arising for decision in this Appeal to the Tribunal are whether printing on duty-paid aluminium foils clone by the appellants on job work basis again attracts levy of Central Excise duty and, if not, whether :

(i) the appellant is the manufacturer in respect of such printed foils;

(ii) if so, whether the appellant is eligible for concession of proforma credit procedure under Rule 56A without having followed the procedure prescribed under the rules ;

(iii) is eligible for benefit to exemption under Notification No. 71/72-CE, dated 17-3-72 as in force at the relevant time ;

(iv) is eligible to benefit of exemption under Notification No. 155/72 dated 15-6-72 duty being collectable only on quantity in excess of 5 MT;

(v) the special excise duty should have been calculated at the rate of 5% and not at the rate of 10%; and

(vi) whether the imposition of penalty and redemption fine in respect of confiscated goods and confiscation of land, building, plant, machinery and materials with option to redeem the same on payment of fine of Rs. 10,000 are legal and justified.

2. The appellants are engaged in printing of duty-paid aluminium foils on job work basis falling under Tariff Item 27 (c). The duty paid aluminium foils are received by the appellants mainly from pharmaceutical concerns. It appears that the appellants had filed a classification list No. 1/79 claiming concession under Notification No. 155/72. The appellants argue that they were under bona fide belief that so long as their clearances were below 5 MT they were not required to pay any central excise duty and on the clearances exceeding 5 MT they were required to pay duty only on quantity in excess of 5 MT. The appellants were clearing the printed foils without payment of duty on their own serially numbered delivery challans without maintaining any excise accounts or submitting any RT 12 returns. The present proceedings are the outcome of transit check by excise authorities on 7-7-80 when they intercepted a tempo bearing registration No. MRL 1175. The vehicle was found to be loaded with printed aluminium foils. After the usual investigation and enquiry the Assistant Collector of Central Excise (Prev.) Hqrs. Bombay served show cause notice dated 5-1-80 to appellants M/s. Swastik Packaging, Bombay, and to two other parties calling upon them to show cause to the Collector of Central Excise (i) as to why for the period 14-5-79 to 7-7-80, including seized goods in transit, central excise duty amounting to Rs. 5,92,400.15 at appropriate rate be not demanded and recovered on 26871.060 Kgs. of printed aluminium foils; (ii) 104 Rolls totally weighing 1121.300 Kgs of printed aluminium foils seized on 7-7-80 be not confiscated; (iii) penalty be not imposed; and (iv) land, building, plant, machinery and materials used in connection with manufacture, production, etc., of the said goods be not confiscated. Appellants M/s. Swastik Packaging, Bombay, by their reply dated 4-9-81 submitted that they had done job work on duty paid aluminium foils mainly supplied by pharmaceutical concerns and duty could not be levied twice under the same sub-tariff item. Printing of foils is not a process of manufacture inasmuch as no new product having different characteristics and uses comes into existence. In case of printing of aluminium foils there was no amendment in section 2(f) of the Central Excises and Salt Act, 1944 (hereinafter called the Act) as in case of printing of plain containers so as to include lacquering and printing of the same as process of manufacture. Duty liability was not on the appellants but on the pharmaceutical concerns who had supplied the foils to the appellants if it be held that the process constituted a manufacture and appellants were manufacturers. Reliance was also placed on Notification No, 305/77, dated 5-11-1977 which exempts de jure manufacturers from payment of duty subject to certain conditions and filing of declar