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2019 (11) TMI 429

..... llants are using inputs consisting of 95% of the Plastic Scrap and Plastic Waste including waste polyethylene terephthalate bottles and therefore the conditions of notification No. 1/2011 - CE as amended are fulfilled - HELD THAT:- The exemption under notification No. 1/2011- CE dt. 01.03.2011 and other analogus notification during the subsequent period were being claimed by the Appellant on the ground that they were using plastic waste in manufacture of Polyster Staple Fibre. The Notification provided exemption to the finished goods of Chapter 54 or 55 and the description of such finished goods was “Polyster Staple Fiber or Polyster filament yarn manufactured from plastic scrap or plastic waste including waste polyethylene terephthal .....

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..... NO.A/12155-12156/2019 - 7-11-2019 - MR. RAMESH NAIR MEMBER (JUDICIAL) AND MR. RAJU MEMBER (TECHNICAL) Shri Wilingdon Christian, Advocate for the Appellant Shri L. Patra Authorized Representative for the Respondent ORDER The instant appeal has been filed by M/s J B Ecotex LLP against Order-in-Original No. SUR-EXCUS-000-COM-042-18-19 dt. 26.03.2019 passed by Commissioner, Central Excise, Surat. The brief facts of the case are that the Appellant are engaged in manufacture of Recycle Polyester Staple Fiber through recycling route falling under chapter sub heading 55032000 of the CETA, 1985. They were using Plastic Scrap or Plastic Waste including waste polyethelene terephthalate bottles for manufacture. They were purchasing Pet flakes and yarn .....

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..... er chapter 55 of the Central Excise Tariff Act, 1985. This is used in manufacture of popcorn and subsequently the Popcorn is used for manufacturing of PSF. It was alleged that the Appellant has availed exemption by suppressing the facts of usage of polyster waste falling under Ch 55. Accordingly it was proposed to deny the exemption and demand duty from Appellant alongwith interest. A penalty under section 11AC was also proposed to be imposed. The demand as proposed was confirmed by the adjudicating authority. Aggrieved by the impugned order, the Appellant has filed present appeal. 2. Shri Willingdon Christian, Learned Counsel, appearing for the Appellant submits that Appellants are using inputs consisting of 95% of the Plastic Scrap and Pl .....

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..... are eligible for exemption. He relies upon judgments in case of Nayak Associates 1991 (55) ELT 189 (Cal.), Bindawala Electrical Ind. Ltd. 2002 (145) ELT 698 (TRI), Tata Iron & Steel Co. ltd. 1977 ELT J61 (SC), Tata Iron & Steel Co. Ltd. 1989 (42) ELT 353 (Pat.), Compack Pvt. Ltd. 2005 (189) ELT 3 (SC), Tara Agencies 2007 (214) ELT 491 (SC). He relies upon the report issued by CIPET that Popcorn produced using waste PET yarn can be considered as recycled PET material. That white popcorn and waste PET flake do not meet the properties of available virgin PET raw material. Hence Popcorn produced using waste PET Yarn can be considered as recycled PET material. He also relies upon certificate issued by Man Made Textile Research Associati .....

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..... and the same was converted into Popcorn for use in manufacture of finished goods. He submits that the facts remain that the input is yarn waste and not plastic waste, hence the exemption under subject notification is not admissible. 4. Heard both the sides and has gone through the case records. We find that the exemption under notification No. 1/2011- CE dt. 01.03.2011 and other analogus notification during the subsequent period were being claimed by the Appellant on the ground that they were using plastic waste in manufacture of Polyster Staple Fibre. The Notification provided exemption to the finished goods of Chapter 54 or 55 and the description of such finished goods was Polyster Staple Fiber or Polyster filament yarn manufactured from .....

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..... ste and the same is by -product. He has also relied upon Note 1A of chapter 54 inserted w.e.f 29.06.2001 by section 142 of the Finance Act, 2012 as per which the PSF and PFY manufactured from Plastic and plastic waste shall be classified as textile material and hence held that the yarn waste is textile material. He also held that for availing exemption the condition of the notification has to be followed. In this context he has relied upon the judgments in case of Eagle Flask Industries 2004 (171) ELT 296 (SC), Bombay Dyeing Mfg. Co. Ltd. 2007 (215) ELT 3 (SC) and tribunal order in case of Sports & Leisure Apparel Ltd. 2011 (271) ELT 529. 5. Having perused the impugned order we find that the subject exemption is available to finished go .....

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