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2017 (1) TMI 1478 - AT - Central ExciseBenefit of N/N. 5/2006 C.E. dated 1-3-2006 - denial on the ground that the appellant did not submit the Intimation in form D-3 in respect of Fly Ash received in the factory on 18-3-2007 as required by the Trade Notice No. 40/97-C.E. (24-Misc.) dated 16-5-1997 issued by Commissioner, CE Jaipur - Held that - the appellant manufacturer is entitled to the benefit of the N/N. 5/2006-C.E. where the product namely Asbestos Cement Pressure Pipe manufactured by the appellant is entitled to be cleared on the concessional rate of duty of 8%. In Central Excise Rules, 2002, there is no requirement to submit D-3 intimation and furnishing of monthly returns as was earlier specified in Trade Notice No. 40/97-C.E., dated 16-5-1997. Thus, the Trade Notice No. 40/97, dated 16-5-1997 is not consistent with the provisions of new Central Excise Rules, 2002 - substantial benefit available in the Central Excise law cannot be denied, when there has been mere omission of following procedural requirements by the assessee. Appeal allowed - decided in favor of appellant.
Issues:
1. Benefit of Notification No. 5/2006-C.E. for cement pressure pipes. 2. Requirement of form D-3 intimation for Fly Ash. 3. Entitlement to concessional rate of duty for products containing Fly Ash. 4. Contravention of Rule 25 of C.E. Rules, 2002. 5. Denial of benefit based on procedural requirements. 6. Interpretation of Trade Notice No. 40/97-C.E. in light of Central Excise Rules, 2002. Analysis: 1. Benefit of Notification No. 5/2006-C.E.: The appellant, a manufacturer of Asbestos Cement Pressure Pipes, contested the denial of the benefit of Notification No. 5/2006-C.E. by the Revenue. The Tribunal found that the appellant was entitled to the concessional rate of duty of 8% under the said notification for their product. 2. Requirement of form D-3 intimation for Fly Ash: The Revenue had cited the non-submission of form D-3 for Fly Ash received as a reason for denying the benefit to the appellant. However, the Tribunal noted that under the new Central Excise Rules, 2002, the requirement for D-3 intimation and monthly returns, as specified in Trade Notice No. 40/97-C.E., was no longer applicable. This procedural lapse could not justify denying the substantial benefit available under the law. 3. Entitlement to concessional rate of duty for products containing Fly Ash: The appellant argued that their product contained more than 25% Fly Ash, making them eligible for the concessional rate of duty. The Tribunal agreed with this contention and held that the appellant met the conditions for availing the concessional rate of duty. 4. Contravention of Rule 25 of C.E. Rules, 2002: The appellant questioned the imposition of a penalty equal to the duty demand, arguing that they had not contravened any specific clause of Rule 25 of the Central Excise Rules, 2002 with the intent to evade duty. The Tribunal did not find any evidence of such contravention and set aside the penalty. 5. Denial of benefit based on procedural requirements: The Tribunal emphasized that the denial of benefits based on procedural lapses, such as the non-submission of form D-3, was unjustified when the substantial conditions for concessional rate of duty were met by the appellant. The appellant's compliance with record-keeping and filing of monthly returns supported their entitlement to the benefit. 6. Interpretation of Trade Notice No. 40/97-C.E. in light of Central Excise Rules, 2002: The Tribunal clarified that the Trade Notice No. 40/97-C.E. was inconsistent with the new Central Excise Rules, 2002, and could not be used to deny the appellant the benefit of Notification No. 5/2006-C.E. The Tribunal's decision favored the appellant's entitlement to the concessional rate of duty based on the substantive provisions of the law. In conclusion, the Tribunal allowed the appeal, setting aside the impugned order and granting consequential benefits to the appellant, affirming their entitlement to the concessional rate of duty under Notification No. 5/2006-C.E.
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