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2023 (10) TMI 1299 - CESTAT CHANDIGARHCaptive Consumption - Benefit of exemption - Time Limitation - requirement to pay Central Excise duty on intermediate goods, i.e. dyed yarn - manufacture for captive consumption or not - benefit of Notification No. 67/95-CE dated 16.03.1995 denied - HELD THAT:- There is no dispute with regard to the fact that entire finished products were exported under bond/LUT and there was no domestic sale by the appellant. The appellant has exported their final product without payment of duty under letter of undertaking and bond executed by them and accepted by the jurisdictional Assistant Commissioner of Customs, New Delhi and the show cause notice dated 05.08.2004 issued by Commissioner of Customs (Preventive) New Delhi was withdrawn in the light of CBEC’s circular No. 19/05-Cus dated 21.03.2005. Since the appellant has got their goods manufactured/yarn dyed from job worker; in these circumstances, the job worker is the manufacturer of dyed yarn and if any duty is to be paid it is to be paid by the job worker. The dyed yarn by the job worker is not captively manufactured by the appellant and in that circumstance, the Notification No. 67/95-CE have no relevance to the facts of the present case - the original authority has held that since the finish goods manufactured by the appellant are chargeable to nil rate of duty under heading 5702.09 the benefit of Notification No. 67/95-CE is not available in view of the proviso to the said notification. But in the present case entire quantity of goods manufactured was exported and these clearances cannot be considered as clearance for home consumption. The appellants are entitled to the benefit of exemption Notification No. 67/95-CE. Further, when the appellants are entitled to exemption, the imposition of penalty on the director is bad in law. The impugned order is set aside - Appeal allowed.
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