TMI Blog2023 (11) TMI 888X X X X Extracts X X X X X X X X Extracts X X X X ..... re no other stipulation under the said subclause. The learned Commissioner reading the said Notification along with Section 5A(1A) came to the conclusion that since, it is an absolute exemption, therefore, payment of duty before completion of the stipulated quantity of 3500 MTs, is incorrect and thereby the condition of the Notification is violated, hence, the appellant would not be eligible to the benefit of the Notification - the said interpretation of the learned Commissioner would not stand the scrutiny of law. Firstly, neither Section 5A(1A) is applicable to the present scenario, since Notification No.4/2006-CE dated 1.3.2006 is a conditional, quantity-based exemption; and admissibility to Nil rate of duty is only to the first clearances of 3500 MTs; there is no other condition stipulated in the said Notification. On a plane reading of the condition as it is, it is opined that the appellants are entitled to avail Nil rate of duty for the first clearances of 3500 MTs in a financial year, irrespective of whether they discharged duty for 500 MTs in between the said clearance - Since, the benefit of Notification has been denied by demanding duty and no demand has been raise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his contention that in any case, adding the quantity of goods cleared on payment of duty and the quantity cleared by availing exemption Notification had not exceeded the total permissible exemption limit of 3500 MTs. He submits that the learned Commissioner erred in observing that the exemption allowed under Notification No.4/2006-CE dated 1.3.2006 being an absolute exemption , therefore, as per Section 5A(1A) of the Central Excise Act, 1944, the appellant could not have paid simultaneously duty on the clearances, while availing exemption. Further, he submits that the present exemption Notification is not an absolute exemption from payment of duty, but conditional exemption in as much as the said exemption is granted only for the first clearances of 3500 MTs against the total quantity manufactured and cleared in a financial year. It is his contention that the maximum quantity allowed in a financial year, for the first clearance is 3500 MTs. In the appellant s case, including the clearances on payment of duty, during the said period, they have not exceeded the maximum permissible limit of 3500 MTs. Further, he has submitted that as on the date of opting for the exemption with effec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uty on the clearance of 441.478 MTs, which is contrary to the provisions contained in Section 5A(1A) of the Central Excise Act, 1944. 7. Before adverting to the rival contention, it is pertinent to reproduce relevant portion of the said Notification No.4/2006-CE dated 1.3.2006 as amended with effect from 01.04.2008, which is reproduced hereinbelow: Notification No. 4/2006-C.E. dated 1.3.2006 Exemption and effective rate of duty for specified goods of Chapters 25 to 49 In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts excisable goods of the description specified in column (3) of the Table below read with the relevant List appended hereto, as the case may be, and falling within the Chapter, heading or sub-heading or tariff item of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) (hereinafter referred to as the Central Excise Tariff Act), as are given in the corresponding entry in column (2) of the said Table, from so much of the duty of excise specified thereon under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paper and paperboard or articles made therefrom cleared for home consumption from a factory, in any financial year, up to first clearances of an aggregate quantity not exceeding 3500 Metric Tonnes. (2) The exemption shall not be applicable to a manufacturer of the said goods who avails of the exemption under the notification of the Government of India in the Ministry of Finance and Company Affairs (Department of Revenue) No. 8/2003-Central Excise, dated the 1st March, 2003. Explanation.- For removal of doubts, it is hereby clarified that the first clearances of an aggregate quantity not exceeding 3500 metric tonnes shall not include clearances of any paper and paperboard or articles made therefrom which attract nil rate of duty or are exempt from the whole of excise duty under any other notification. 9. For the present purpose, clause (i) of the Condition No.10 is relevant. It is stipulated under the said clause (i) of Condition No.10 that the exemption shall apply only for clearances made for home consumption from a factory in any financial year up to first clearances of aggregate quantity not exceeding 3500 MTs. 10. I do not find any other stipulation under the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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