Full Judgment
2. Shri Jitender Singh, ld. Advocate, submitted that they are clearing the plastic bags, falling under Heading 39.23 of the Central Excise Tariff at nil rate of duty by availing exemption under Notification No.15/94, dated 1-3-1994 (Sl. No. 21). The condition for availing the nil rate of duty on plastic bags was that the Modvat credit of the duty on the inputs has not been availed of by the manufacturer. If any manufacturer of plastic bags avails of Modvat credit of duty paid on inputs, he has to pay duty @ 30 per cent under SI. No. 23 of the notification. He, further, mentioned that the Sl. Nos. 21 and 23 of Notification No. 15/94 have been placed therein keeping in view the interest of both manufacturers - one who clears the goods after availing the credit under Rule 57A and the other who does not take credit of input duty. Had they opted for Sl. No. 23, they would not require to pay any duty on the intermediate product. On the basis of such interpretation, the appellants did not pay any duty on the plastic bags.
3. Shri Sumit K. Das, ld. JDR reiterates the findings contained in Order-in-Original and Order-in-Appeal.
4. We have considered the submissions of both sides. It has not been disputed by the appellants that a new product, namely, plastic tubes, comes into existence at intermediate stage. The appellants have also not made any averment that the product is not marketable. Once a new product comes into existence, it is to be charged to duty if not exempted under any notification. SI. No. 17 of the Notification 15/94 provides a concessional rate of duty in respect of the goods falling under Heading 39.17 of the Tariff without any condition. In view of these facts, we find no merit in the appeal, which is rejected.