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2016 (10) TMI 30 - AT - Central ExciseSSI Exemption - Whether or not appellant can change it s option under clause 2 (i) of Notification No. 9/03-CE dated 1/3/2003 in the same financial year - appellant initially filed declaration in April, 2004 where exemption under Notification No. 91/03-CE was availed and Central Excise duty was paid @ 9.6% and subsequently appellant vide letter dated 1/9/2004 intimated the Department that they will be paying full rate of duty @16% - Held that:- in view of the provisions contained in clause 2(i) of exemption under Notification No. 9/03-CE, option exercised once cannot be changed by the appellant in the same financial year. This issue has been decided in the case of Canara Poly Pack Ltd. Vs. Commr. of C.Ex., Bangalore-III [2007 (9) TMI 286 - HIGH COURT OF KARNATAKA AT BANGALORE] by Hon’ble Karnataka High Court where it has been held that option once exercised shall not be withdrawn by the manufacturer during the remaining part of the same financial year. Therefore, in this case option exercised in April, 2004 by the appellant will continue to hold good for the entire financial year. Appellant was not entitled to change such option exercised once and start paying duty at full rate. Therefore, observations made by first appellate authority in Order-in-Appeal to deny exemption for the entire financial year is ex facie wrong and is set aside. In such cases of interpretational disputes, Bench is of the considered opinion that no penalty proposed in the show cause notice is imposable. Recovery of Cenvat credit - improper utilisation of CENVAT Credit - clearances of goods when 16% rate was wrongly paid by the appellant - Held that:- this aspect will only be decided by the adjudicating authority in remand proceedings as directed by the first appellate authority. - Appeal partly allowed and partly remanded back
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