Collector of Central Excise Vs. Vip Industries

Collector of Central Excise vs Vip Industries

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi Decided May 14, 1998

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Citation: sooperkanoon.com/13431
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi
Decided On: May 14, 1998
Subject: MRTP

Case Summary

AI-generated summary - not the official court judgment text.

MRTP

Key legal issue: MRTP

Parties & Advocates

Appellant / Petitioner

Collector of Central Excise

Respondent

Vip Industries

Legal References

Reported In: (1998)(103)ELT95TriDel

Excerpt

.....chapter 42 and polybags falling under chapter 39. they had cleared polybags on payment of duty even though exemption from duty was available under notification 53/88. similarly the respondents had also taken credit on ldpe granules used in the manufacture of polybags which were exempted from payment of duty. a show cause notice was issued for recovery of an amount of rs. 31,114.53 in view of trade notice no.11/91, dated 11-2-1991 and proposing disallowable of modvat credit of rs. 67,958.55 on the granules. the assistant collector confirmed the demand of duty and also disallowed the credit. the collector (appeals) has allowed the appeal of the assessee accepting their contention that as per the practice during the period prior to the issue of trade notice no. 11/91, they were exercising the option to pay duty even in cases where the goods were fully exempt and the withdrawal of the notice had only prospective effect. hence this appeal by the revenue.c.c.e., new delhi v. thermopack industries - final order nos, 70-71/98-c, dated 18-2-1998, the issue has been decided on merits holding that the assessees could avail of the option of paying duty and not availing full exemption which in any case is subject to the condition contained in col. 5 of the table annexed to the notification 53/88. the relevant paragraph from the above order is reproduced below :- 4. we have gone through the exemption notification no. 53/88-c.e., dated 1-3-1988 as amended. we find that the exemption against sr. no. 39 of the table aforesaid was a conditional exemption. in case the conditions are not satisfied then the goods were to be assessed to duty against sr. no. 40. it could not be argued by the revenue that the manufacturer should avail of the benefit of nil rate of duty against sr. no. 39 when the goods were equally classifiable under sr. no. 40. the ld. advocate had referred to a number of decisions of this tribunal to the effect that when there are two exemption notifications equally.....

Full Judgment

1. The respondents herein are manufacturers of travel goods falling under Chapter 42 and polybags falling under Chapter 39. They had cleared polybags on payment of duty even though exemption from duty was available under Notification 53/88. Similarly the respondents had also taken credit on LDPE granules used in the manufacture of polybags which were exempted from payment of duty. A show cause notice was issued for recovery of an amount of Rs. 31,114.53 in view of Trade Notice No.11/91, dated 11-2-1991 and proposing disallowable of Modvat credit of Rs. 67,958.55 on the granules. The Assistant Collector confirmed the demand of duty and also disallowed the credit. The Collector (Appeals) has allowed the appeal of the assessee accepting their contention that as per the practice during the period prior to the issue of Trade Notice No. 11/91, they were exercising the option to pay duty even in cases where the goods were fully exempt and the withdrawal of the Notice had only prospective effect. Hence this appeal by the Revenue.C.C.E., New Delhi v. Thermopack Industries - Final Order Nos, 70-71/98-C, dated 18-2-1998, the issue has been decided on merits holding that the assessees could avail of the option of paying duty and not availing full exemption which in any case is subject to the condition contained in Col. 5 of the Table annexed to the Notification 53/88. The relevant paragraph from the above order is reproduced below :- 4. We have gone through the exemption Notification No. 53/88-C.E., dated 1-3-1988 as amended. We find that the exemption against Sr.

No. 39 of the Table aforesaid was a conditional exemption. In case the conditions are not satisfied then the goods were to be assessed to duty against Sr. No. 40. It could not be argued by the Revenue that the manufacturer should avail of the benefit of nil rate of duty against Sr. No. 39 when the goods were equally classifiable under Sr. No. 40. The ld. Advocate had referred to a number of decisions of this Tribunal to the effect that when there are two exemption notifications equally applicable to a manufacturer, it is his option as which of the exemption notification he avails of. In this case we find that the Sr. Nos. 39 and 40 are not similarly worded as we consider that it was the option of the assessees (sic) the condition as given in Column 5 of the Table annexed to the exemption Notification.

3. Following the ratio of the above order which is a decision on the merits of the eligibility of the respondents to the benefit of Notification 53/88, we hold that there is no infirmity in the order passed by the lower appellate authority and accordingly uphold the same and reject the appeal.

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Delh... Same Parties Collector of Central Excise vs Vip Industries Same Subject MRTP