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2022 (8) TMI 986 - MADRAS HIGH COURTRecovery of excise duty leviable on cotton yarn manufactured and removed captively for the manufacture of entire grey cotton fabrics - benefit of duty exemption under Notification No.22/96-CE, dated 23.07.1996 - Rule 49A of the erstwhile Central Excise Rules, 1944 - HELD THAT:- It is seen that this is the second round of litigation. Earlier the petitioner suffered an order in original No.14 of 2002 dated 28.03.2002. Thereafter, the petitioner challenged the same before the CESTAT - the petitioner again participated in adjudicating the proceedings before the Commissioner. In the meanwhile, the jurisdiction Assistant Commissioner finalized the provisional assessment, passed the assessment order dated 24.06.2011. Following the same, he had passed three refund orders. Admittedly, all the four orders never challenged by the department by way of revision. Now, the assessment finalized. The Deputy Commissioner in his letter of the year 2001 cleared the doubt of the department and the difficulty. Admittedly, the petitioner is a composite mill, wherein, yarn is manufactured consumed captively in manufacture of both grey and process fabrics. The process fabrics are mostly dutiable and further there is exemption from paying duty on the yarn. In view of the same, in the yarn manufacture, the portion of the same is used for export. As regards grey fabric, it is exempted for clearance, hence, duty to the yarn used for this process to be paid. This calculations can be precisely made only at the time of clearance either as grey fabric or process fabric. In the impugned order, there is no discussion about considering the report of the Deputy Commissioner of the year 2001, which is followed and orders passed by the jurisdictional Assistant Commissioner, while passing the assessment order which ought to be considered before finalizing the order in original. The matter is remitted back to the Commissioner to consider afresh the petitioner's plea from the stage of issuance of show cause notices - petition allowed by way of remand.
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