The process of roasting Rava does not amount to manufacture under Section 2(f) of the Central Excise Act, thus no excise duty is applicable.

PER: D.M. MISRA

These 3(three) appeals are filed against Order-in-Original No. BLR-EXCUS-0050COM-55/15-16 dated 26.02.2016 passed by the Commissioner of Central Excise, Bangalore.

2. Briefly stated the facts of the case are that the appellants are engaged in the manufacture of Maida, Suji, Atta, Tandoori, Chiroti, R Bran, Bran Flakes, etc., during the relevant period. On the basis of intelligence their premises were searched and statements were recorded which revealed that the appellants are manufacturing single / double roasted Sooji / Rava packed in unit containers under the brand name of ‘Pillsbury’ but had not discharged duty on the same. It is alleged that the process of drying and roasting of Sooji / Rava carried out by them as per the demands from their customer M/s. General Mills India Pvt. Ltd. results into ‘manufacture’ and clearing the same without payment of duty is in contravention of various provisions of Central Excise Act, 1944 and the Rules made thereunder. Further, it is alleged that the process of single/double roast of Sooji/Rava and marketing it in unit containers fall under Chapter Subheading 19019090 of Central Excise Tariff Act, 1985 , attracting duty and also Maximum Retail Price (MRP) based assessment under Section 4A of read with Notification No. 49/2008-CE (NT) dated 24.12.2008. Consequently, Central Excise duty of Rs.1,95,51,297/- was demanded for the period from 05.08.2010 to 31.10.2013 along with interest and penalty; penalty proposed against the Managing Director and Executive Director of the appellant- company. On adjudication, the demand was confirmed with interest and penalty; also, personal penalty imposed on the Managing Director and Executive Director of the appellant-company. Hence, the present appeals.

3. At the outset, the learned advocate for the appellants has submitted that the product Rava whether roasted or not is covered under Chapter Subheading 1103 of Central Excise Tariff Act, 1985 . He has submitted that Chapter 11 covers "Products of the Milling Industry; Malt; Starches; Inulin; Wheat Gluten". Referring to Chapter Sub-heading 11031120, he has submitted that it refers to 'Meal' attracting 'Nil' rate of duty. Further, referring to Chapter Note 3 of Chapter 11 and the HSN Explanatory Note to Chapter 11, he has submitted that on a collective reading of the Chapter Note and HSN, Chapter 11 includes products from the milling of the cereals of Chapter 10. In the present case, there is no doubt that 'wheat' goes through various processes like grinding, cleaning, etc., resulting into manufacture of Rava (Meal). Further, referring to HSN Explanatory Note to Chapter 1103, he has submitted that ‘Meal’, as described in the Explanatory Note, is a granular product than flour and is obtained by first sifting and regrinding and resifting after initial milling. The Rava is undisputedly a more granule product than the flour and it is obtained in the manner as mentioned in the definition of 'Meal' given in the HSN Explanatory Note given in the Chapter Heading 1103, therefore, Rava is covered under Chapter Heading 1103, which is not in dispute either in the show-cause notice or in the impugned order. Further, he has submitted that HSN Explanatory Note to Chapter Heading 1103 covers 'durum wheat meal or semolina', which is the principal raw material in the manufacture of macaroni, spaghetti or like and Semolina is also directly used as foodstuff. It is submitted that semolina is the English common name for Rava/Suji and in this context, Bureau of Indian Standards IS 1010:1968 and IS 1010:2023 specifies standards for Rava/Suji inasmuch as the said words are interchangeable and