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2013 (6) TMI 680 - AT - Central ExciseSimultaneous availment of benefit of Notification No. 30/2004-C.E., dated 9-7-2004 and Notification No. 23/2003-C.E - DTA clearances - Held that:- Excisable goods cleared by the appellant are covered by both the notifications. However, rates and conditions are different in two notifications. Notification No. 29/2004-C.E. prescribed duty of 4% (on cotton yarn) and 8% (on other yarns covered by specific headings) without any condition. Notification No. 30/2004-C.E., on the other hand prescribes NIL rate of duty subject to the condition that no credit of duty on inputs or capital goods has been taken under the provisions of the Cenvat Credit Rules, 2004. This condition cannot be satisfied on the goods manufactured or produced outside India and imported into India as the Central Excise Law including Cenvat Credit Rules, 2004 are inapplicable there. Thus we hold that duty rates applicable will be as per Notification No. 29/2004-C.E. or any other notification (if relevant to the goods in question) and not as per Notification No. 30/2004-C.E. Further, Explanation to Section 3(1) of the Customs Tariff Act clearly mandates that where excise duty is leviable at different rates, the highest duty is to be taken. Notification No. 30/2004-C.E. is not applicable to the imported goods as conditions prescribed therein cannot be satisfied on the goods produced or manufactured outside and imported into India. Even for the sake of argument, if it is assumed that it is applicable, in view of Explanation to Section 3(1) of the Customs Tariff Act, 1973 as also Explanation 1 to Section 3(1) of the Central Excise Act, 1944 (which is specific to 100% Export Oriented Units), we have no hesitation in holding that rates prescribed under Notification No. 29/2004-C.E., which are higher than prescribed under Notification No. 30/2004-C.E. will be applicable. We accordingly hold that Additional duty of Customs will be computed as per Notification No. 29/2004-C.E. and Notification No. 30/2004-C.E. For the units (other than 100% EOU), two options are available viz. pay 8/4% excise duty (without any condition) or NIL rate of excise duty provided no Cenvat credit is taken on the inputs or capital goods used in the manufacturing process. Appellant has contended that they have not availed Cenvat credit on inputs, hence NIL rate will be applicable to them. Both the Notification Nos. 29/2004-C.E. and 30/2004-C.E., as held by us earlier are inapplicable for 100% EOU in view of proviso to Section 5A(1) of the Central Excise Act and therefore availment or non-availment of Cenvat Credit by 100% EOU is irrelevant. In any case unlike normal unit, 100% EOU can get inputs duty-free and therefore not avail the Cenvat credit or get duty-paid inputs and avail Cenvat credit. Normal DTA units have no such option. They have to get duty-paid inputs. However, after paying duty on inputs, they have option to avail or not to avail credit and pay duty on the final product or clear it at NIL rate of duty. Thus NIL rate is conditional. Under the circumstances, we hold that the final products of appellant has to be considered as dutiable at the rate of 8 or 4% under Notification No. 29/2004-C.E., dated 9-7-2004 and not NIL rate under Notification No. 30/2004-C.E., dated 9-7-2004. Documents do not prove that goods cleared in DTA were manufactured from the raw materials produced or manufactured in India. Lot registers or production related documents have not been produced. However, there are certain claims like cotton fibre has never been imported. If purchase documents do not indicate that material is imported, it would be reasonable to assume that cotton yarn is manufactured from raw material produced or manufactured in India and duty benefit under Sr. No. 3 of Notification No. 23/2004-C.E. can be extended. Similarly, if in a particular period all the polyester yarn was made only from polyester staple fibre produced in India and appellant did not have stock of imported PSF or final product made of imported PSF, then benefit under Sr. No. 3 of Notification No. 23/2004 can be extended - Matter remanded back - Decided in favour of assessee.
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