TMI Blog2017 (12) TMI 888X X X X Extracts X X X X X X X X Extracts X X X X ..... irming the demand of ₹ 29,83,906/- alongwith interest and imposing equivalent amount of penalty. 2. The facts of the case are that the appellant is located in the State of Jammu Kashmir and engaged in the activity manufacturing menthe oil (fractioned/De-terpenated (DMO), De-Mentholized Oil (DMO), Mentha Oil (Fraction/Terpene), Menthone etc. The appellant was availing the exemption under Notification No.56/02-CE dated 14.11.2002 as amended by way of demanding credit of inputs paying duty on finished goods after utilization the credit and thereafter taking self-credit of duty paid from PLA. The show cause notice was issued to the appellant on the ground that during the period March, 2010 and June, 2010, the appellant cleared their goods falling under Chapter sub-heading 33012590 on payment of duty in contravention of the Exemption Notification with an intent to take undue benefit of the said Notification by way of self credit refund and because of which the said amount of ₹ 29,83,906/- did not represent proper and lawful duty in terms of section 3 of the Central Excise Act, 1944. Accordingly, the self credit taken by the appellant in respect of this duty also did not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Mangalam Alloys Ltd - 2010 (255) ELT 124 (Tri.-Ahmd) and Bharat Prelam Industries Ltd - 2017 (346) ELT 278 (Tri.-DeI.) 5. In alternate, he submits that as the goods cleared by the appellant were exempted, therefore, the appellant was not required to pay duty in terms of Notification No.10/10-CE dated 17.2.2010, in that circumstance, the provisions of section 11A of the Central Excise Act, 1944 are not applicable in the present case. As the section 11A of the Act applies when the duty is allegedly short paid or nor paid or erroneously refunded. The appellant was not required to pay duty by virtue of notification, therefore, the amount paid by the appellant through PLA is not duty within the provision of section 11A. Therefore, the impugned order is to be set aside. 6. On the other hand, learned AR submits that as per the Notification No.10/10-CE dated 17.2.2010, the goods were exempt from the payment of duty and the appellant has paid duty on their own and took self-credit of the same which is not permissible, therefore, erroneously self-credit taken by the appellant is required to be refunded by them. 7. Heard both sides and considered the submissions. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the said benefit cannot come in the way of the applicant in claiming exemption under category 3 if the conditions laid down thereunder have been fulfilled. The High Court also committed the same error and hence the order of the High Court also suffers from the same infirmity and is liable to be set aside. 11. We further, find in the case of Mangalam Alloys Ltd and Bharat Prelam Industries Ltd (supra), this Tribunal has again observed that if there are two notifications, it is open to the assessee to choose the notification which is more beneficial to him. Admittedly, in the case in hand, both notification No.56/02-CE dated 14.11.2002 and Notification No.10/10-CE dated 17.2.2010 were available to the appellant, therefore, it is open to the assessee to choose which is more beneficial to him. Admittedly, when the appellant chooses notification No.56/02-CE, therefore, the same cannot be denied to the appellant. 12. With these observations, we hold that the appellant has rightly claimed the benefit of Notification No.56/02-CE by paying duty through PLA and taken the self-credit which is permissible to the appellant. Therefore, the issue No.1 is answered in favour of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id goods were unconditionally and absolutely exempt under Notification No.10/2010-CE dt. 27.10.2010 as amended. The original adjudicating authority as well as the Commissioner (Appeals) have held that in view of Sub Section 11A of Section 5A of the Central Excise Act, 1944 appellant did not have the option to pay duty when the goods were unconditionally and absolutely exempt and hence the self credit of such duty paid was not admissible. The main argument of the appellant is that when two exemption notifications are applicable to the product, the assessee has an option to choose which is beneficial to him. For this, they have relied upon the following judgments:- 1 . HCL Ltd. Vs. Collector of Customs, New Delhi-2001 (130) ELT 405 (SC). 2. Share Medical Care Vs. Union of India 2007 (209) ELT 321 (SC) 3. Mangalam Alloys Ltd. Vs. Commissioner of Cus., Ahmedabad - 2010 (255) ELT 124 (Tri.-Ahmd.). In this context, Section 5A (1A) of the Central Excise Act reads as under:- 1(A) for the removal of doubts, it is hereby declared that where an exemption under sub-section (1) in respect of any excisable goods from the while of the duty of excise leviable thereon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is completely untenable in view of the said statutory provision which would prevail over delegated legislation in the form of notification. The appellants are therefore required to follow the same and not to pay the duty. Issue No.2. 5. The appellants have argued that they had not paid the duty but availed the exemption under Notification No.56/2002-CE. Undoubtedly, Notification No.56/2002 is an area based exemption notification. However, legislature has formulated special mechanism to implement the notification, Under this, duty is first calculated applying normally assessment methods and part of the duty is paid utilizing the Cenvat Credit and other part is paid through PLA. The payments thus made are in the nature of duty and after depositing the same end verification of the criteria for refund, the eligible amount of the duty is refunded. For that reason, the notification speaks of duty payable and duty paid. Hence, it is incorrect to say that what is being paid and what is being refunded does not have the character of duty. The notification itself in Para 2C(g) while dealing with irregular availment of self credit mention that shall be recoverable as if it is a re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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