2004 (3) TMI 484 - AT - Central Excise

Summary

Issues:
1. Benefit of Notification No. 135/94-C.E. denied
2. Consequential demand raised

Issue 1: Benefit of Notification No. 135/94-C.E. denied

The appellants, engaged in manufacturing aluminium circles and utensils, filed appeals against the order-in-appeal denying the benefit of Notification No. 135/94. They claimed entitlement to the notification as they cleared aluminium circles for utensils without availing Modvat credit. The Revenue argued that the appellants were already benefiting from Notification No. 1/93 and were availing credit for inputs used in manufacturing circles, thus not eligible for Notification No. 135/94. Citing the Novopan India Ltd. case, the Revenue stressed that exemptions must be strictly construed, with the burden on the assessee to prove eligibility. The tribunal found that since the appellants were availing credit for inputs while also benefiting from Notification No. 1/93, they did not meet the conditions of Notification No. 135/94. Consequently, the appeals were dismissed.

Issue 2: Consequential demand raised

The appellants' contention that they were entitled to the benefit of Notification No. 135/94 was based on their practice of clearing aluminium circles for utensils without taking credit for inputs used in manufacturing. However, the Revenue argued that the appellants were already availing benefits under Notification No. 1/93 and were taking credit for inputs, making them ineligible for the additional benefit of Notification No. 135/94. The tribunal, following the principle of strict construction of exemptions and placing the burden of proof on the assessee, upheld the denial of benefits under Notification No. 135/94. As the appellants were found to be availing credit for inputs used in manufacturing aluminium circles, they were not entitled to the exemption. Consequently, the consequential demand raised against the appellants was upheld, leading to the dismissal of the appeals.

This summary provides a detailed analysis of the judgment, covering all the issues involved and the reasoning behind the tribunal's decision in each case.