TMI Blog2023 (9) TMI 403X X X X Extracts X X X X X X X X Extracts X X X X ..... out of duty paid textured yarn or twisted yarn and that CENVAT Credit on such inputs had not been availed. It is not the case of Revenue that credit had been availed. In identical circumstances, it has been held by the Tribunal in re Shreekar Polyester Pvt Ltd [ 2017 (1) TMI 25 - CESTAT MUMBAI ] that there is no condition that if doubled yarn is subject to the process of dyeing, the dyed yarn is entitled for exemption only if at the doubling stage duty had been discharged. Moreover, the appellants contended that even if the duty is paid at the doubling stage, Cenvat credit can be availed for clearance of dyed yarn and in effect there would be revenue neutrality. In these circumstances, the appellant s interpretation of condition 19(ii) appears to be correct. Thus, nothing further remains to be decided in the dispute - the appeal allowed by setting aside the impugned order. - HON BLE MR C J MATHEW, MEMBER (TECHNICAL) And HON BLE MR AJAY SHARMA, MEMBER (JUDICIAL) Ms Kiran Doiphode, Advocate for the appellant Shri P K Acharya, Superintendent (AR) for the respondent ORDER PER : C J MATHEW M/s Shree Rishabh Polyester, aggrieved by order for reco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e process of dyeing, printing, bleaching or mercerising in the manufacture of dyed, printed, bleached or mercerised yarn. in notification claimed to be applicable to appellant. 4. We are not entirely convinced with the submission of Learned Authorized Representative. It is clear from the decision of the Tribunal in re Shreekar Polyester Pvt Ltd that The fact of the case is that the respondents are engaged in the manufacture of Dyed Polyester Filament Yarn falling under Chapter No. 54, during relevant period of dispute they availed exemption of Notification No. 6/2002-CE dated 01.03.2002 (Sr. No. 126 with condition No. 31), accordingly, cleared the finished goods i.e. Dyed Polyester Filament Yarn on payment of specific basic excise duty of Rs. 9/- per Kg. + 15% on BED as additional Excise duty (T TA). For the purpose of manufacture of the aforesaid goods the respondent purchase the texturised yarn on payment of appropriate duty which is subsequently twisted and thereafter dyed. The exemption notification was proposed to be denied on the ground that for the manufacture of Dyed Polyester Filament Yarn though the duty paid texturised yarn was purchased but captively the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pondent. In the case of Kejariwal Yarns Pvt Ltd. (supra) this Tribunal has held as under:- 2. We have carefully considered the submissions made by both sides. Admittedly, during the relevant period, the appellant had availed benefit of the notifications in question. The condition required to be fulfilled for availing benefit of above notifications is as under : (i) Manufactured out of textured or draw-twisted yarn falling under Chapter 54 of die First Schedule on which the appropriate duty of Excise under the First Schedule, the special duty of Excise leviable under the Second Schedule to the Central Excise Tariff Act, 1985 has already been paid; and (ii) No credit under Rule 3 or Rule 11 of the Cenvat Credit Rules, 2001 has been availed in the process of dyeing, printing, bleaching or mercerizing in the manufacture of dyed, printed, bleached or mercerized yarn. 3. As per the Revenue, the said condition does not stand fulfilled inasmuch as the appellant had manufactured dyed twisted yarn out of twisted yarn on which no duty was paid. On the other hand, it is the appellant s contention that the starting raw material for manufacture of dyed twisted yarn was duty p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other words there is no condition that if doubled yarn is subject to the process of dyeing, the dyed yarn is entitled for exemption only if at the doubling stage duty had been discharged. Moreover, the appellants contended that even if the duty is paid at the doubling stage, Cenvat credit can be availed for clearance of dyed yarn and in effect there would be revenue neutrality. In these circumstances, the appellant s interpretation of condition 19(ii) appears to be correct. In view of these observations, we allow the appeal with consequential relief. 6. By following the ratio of law as declared in the above decision, we hold that the condition of notification stand fulfilled and the impugned order confirming demand of duty is required to be set aside. 7. Apart from the merits of the case, we also note that the demand is barred by limitation having been raised beyond the normal period of one year. Admittedly, the benefit of the concessional rate of duty in terms of notification was being availed by the appellant after making declaration to the department and after making entries in the statutory records. The reasoning of the Commissioner that by claiming conditional exem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, answer would be YES . The dyed yarn was manufactured out of single yarn on which, duty was paid even though at the doubling stage, exemption was availed. There is no condition that the yarn should have suffered duty at every stage. In other words there is no condition that if doubled yarn is subject to the process of dyeing, the dyed yarn is entitled for exemption only if at the doubling stage duty had been discharged. Moreover, the appellants contended that even if the duty is paid at the doubling stage, Cenvat credit can be availed for clearance of dyed yarn and in effect there would be revenue neutrality. In these circumstances, the appellant s interpretation of condition 19(ii) appears to be correct. In view of these observations, we allow the appeal with consequential relief. From the above Tribunal decision, the issue is no longer res integra. .. From the above findings, we observed that the Learned Commissioner (Appeals) has correctly examined the issue and accordingly allowed the appeal of the respondent. As per the above discussion and following the decision in the case of Kejariwal Yarns Put. Ltd. (supra) and Precot Mills Ltd. (supra) the impugned order do ..... 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