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2011 (5) TMI 82 - AT - Central ExciseDemand and penalty u/s 11AC - Exemption - Limitation - the appellant is engaged in manufacture of twisted polyester yarn - Revenue s allegations are that though the duty was to be discharged at texturised stage, no duty was paid on such twisted yarn when transferred from texturising unit of the dyeing unit - As such, clearance of died yarn by availing the benefit of concessional rate of duty in terms of Notification No.5/98-CE and exemption Notification No.3/01-CE were not available to the appellant - Proceedings were initiated against by way of issuance of Show Cause Notice dt.30.6.03 for raising the demand for the period June 1998 to February 2003 - The said Show Cause Notice has culminated into an impugned order passed by the Commissioner - Hence, set aside the impugned order and remand the matter to Commissioner for fresh decision in the light of the observations made in the order of M/s Kiran Industries Ltd. -
Issues:
1. Confirmation of duty and penalty against the appellant. 2. Allegations of duty evasion and misuse of concessional rates. 3. Benefit of limitation and remand for fresh decision. Analysis: 1. The judgment confirmed a duty of Rs.19,39,18,908 along with a penalty under Section 11AC against the appellant. Additionally, a Central Excise duty of Rs.13,87,34,616 was confirmed with a penalty under the same provision. Furthermore, a penalty of Rs.5 Crores was imposed on an individual associated with the case. 2. The appellant, engaged in the manufacture of twisted polyester yarn, procured Polyester Filament Yarn/Partially Oriented Yarn and subjected it to texturising. The texturised yarn was used in further manufacturing twisted polyester yarn, which was sent for dyeing without paying duty. The Revenue alleged that duty should have been paid at the texturised stage and that the appellant did not fulfill the conditions of certain notifications regarding concessional rates. 3. The appellants also purchased yarn from the market, processed it, and sold it as twisted yarn without paying duty, claiming that the product remained the same. The proceedings were initiated based on a Show Cause Notice, leading to the impugned order by the Commissioner. The appellant sought the benefit of limitation based on a previous Tribunal decision and requested a remand for fresh consideration. 4. The Tribunal, considering the arguments and the previous decision in a similar case, set aside the impugned order and remanded the matter to the Commissioner for a fresh decision. The Commissioner was directed to consider the observations from the previous case and decide on the issue of limitation. Both appeals were allowed in these terms, providing relief to the appellant for further proceedings.
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