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2017 (7) TMI 475 - CESTAT CHANDIGARH

2017 (7) TMI 475 - CESTAT CHANDIGARH - TMI - Scope of SCN - Benefit of N/N. 67/95-CE dated 16.3.1995 - denial of benefit on the ground that the appellant has consumed the dyed yarn in their factory and since the handloom durries was chargeable to nil rate of duty the benefit of Notification not available - Held that: - the provisions of Rule 12B were neither invoked in the show cause notice nor dealt in the adjudication order. On being asked, the Learned AR also could not show us where Rule 12B .....

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he exported good, the same would have been liable to be refunded to the appellants themselves as manufacturer exporter. In these circumstances, the situation was revenue neutral and there appears to be no mala fide on part of the appellants. Hence, extended period and penal provisions are not applicable in this case. - Appeal allowed - decided in favor of appellant. - Appeal No. E/1409 & 1593/2008 - Final Order No. 61209-61210/2017 - Dated:- 24-4-2017 - Mr.Ashok Jindal, Member (Judicial) And .....

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uct for the manufacture of the above said exempted final product. The durries were manufactured on handlooms manually without the aid of power and were exempted from payment of duty. The show cause notice was issued to the appellants on the ground that the appellant has consumed the dyed yarn in their factory and since the handloom durries was chargeable to nil rate of duty the benefit of Notification No.67/95-CE dated 16.3.1995 was not available to them. Period of dispute is 01.03.2003 to 13.01 .....

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ssing in this case was done outside their factory by the job workers and hence Notification No.67/95-CE was not applicable. In that sense, the Commissioner (Appeals) had erred in holding that the goods were captively consumed in the manufacture of durries, which was chargeable to nil rate of duty and the benefit of Notification No.67/95-CE was not available to them. He further argued that the First Appellate Authority s order has proceeded on a different premise as there was no mention of Rule 1 .....

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he following case laws: (i) CCE vs. Balarpur Industries Pvt.Ltd.-2007 (215) ELT 489(SC) (ii) Precision Rubber Industries Pvt.Ltd. vs.CCE-2016 (334) ELT 577 (SC) (iii) CCE vs. Gas Authority of India Ltd-2008 (232) ELT 7 (SC) (iv) Oswal Agro Mills vs. CCE-1995 (75) ELT 21 (SC) (v) Basant Industries vs. CCE, Kanpur-1995 (75) ELT 21 (SC) (vi) Vinod Kumar Gupta vs. CCE-2013 (287) ELT 54 (P&H). Learned Counsel also argued that the situation was revenue neutral as they would have got refund for the .....

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The appellants were getting grey yarn and the same was got dyed from the job workers. The job workers were clearing the dyed yarn without payment of duty as the same was being used by the appellant for manufacture of final product, which was exported. We further find that the Commissioner (Appeals) has relied on the Rule 12B to conclude that the goods were produced on account of the appellant. Ld. Advocate has rightly pointed out that the provisions of Rule 12B were neither invoked in the show c .....

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er to invoke the said Rule. In this context, para 21 of the said judgement is relevant and is extracted below: 21. Before concluding, we may mention that, in the present case, the second and the third show cause notices are alone remitted. The first show cause notice dated 21-5-1999 is set aside as time-barred. However, it is made clear that Rule 7 of the Valuation Rules, 1975 will not be invoked and applied to the facts of this case as it has not been mentioned in the second and the third show .....

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