Judgment:
1. The issue involved in this Appeal, filed by M/s. Eicon Clipsal India Ltd., is whether the benefit of exemption under Notification No.67/95-CE., dated 16-3-95 is available in respect of moulds dies and press tools.
2. We heard Shri Jitendra Singh, learned Advocate for the Appellants, and Shri Jagdish Singh, learned Departmental Representative, for the Revenue. The facts in brief are that the Appellants entered into a contract with one M/s. Gerard Industries Pvt. Ltd. for manufacture of various electrical goods. It was also agreed upon that the Appellants would manufacture press tools, moulding dies for use within their factory for manufacture of the contracted goods. The Appellants, though did not remove these tools and dies from their factory premises, issued invoices dated 2-10-1998 to their customers for getting payment. The Assistant Commissioner, under Order-in-Original No. 81/99, dated 11-6-1999 disallowed the benefit of Notification No. 67/95-C.E. holding that the clearance cannot be treated for captive consumption. The Commissioner (Appeals) also under the impugned Order rejected their Appeal holding that where the goods which are meant for others and are retained in the factory, the procedure as prescribed under Rule 173H of the Central Excise Rules, 1944, has to be followed and goods could be retained only on payment of duty and, therefore, the question of availing benefit of Notification No. 67/95 does not arise because the said Notification applies to a manufacturer, who uses the goods on his own account manufactured in his factory. The learned Advocate has contended that Notification No. 67/95 does not stipulate that exemption to inputs and capital goods manufactured and captively consumed within the factory of manufacture is available only if the goods belong to the manufacturer; that the said exemption is available to all the inputs and capital goods used within the factory of manufacture; that the ownership of such goods is totally irrelevant. He has relied upon the decision in the case of BPL Electronics Ltd. v. C.C.E., Bangalore, 1994 (71) E.L.T. 801 (T).
3. We have considered the submissions of both the sides. Notification No. 67/95-C.E. exempts capital goods manufactured in a factory and used within the factory of production. It has not been disputed by the Revenue that the impugned goods were used within the factory of production only. The exemption has been disallowed on the ground that as per the invoices raised by the Appellants the impugned goods had been sold to M/s. Gerald Industries Pvt. Ltd. The Notification is applicable if the Capital goods are used within the factory of production. We agree with the submissions of the learned Advocate that Notification nowhere provides that the use should be on the account of manufacturer. The exemption is available on the basis of place of use i.e. "within the factory of production" which has not been disputed by the Revenue. The decision in the case of BPL Electronics Ltd., supra, is applicable on all fours to the facts of this case. It has been held as under: "The goods are dutiable, irrespective of sale or not. But once they are exempted from payment of duty on its further utilization in the factory itself, then the question of collecting duty does not arise.
The grant of benefit of exemption under notification in question is only on the criteria of the goods being "manufactured in a factory and intended for use in the factory in which they are manufactured".
Admittedly, the goods manufactured, were intended for use in the factory in which they were manufactured, thus the question of discharging duty on the basis of mere fact of raising an invoice in favour of B.P.L. Finance Ltd. does not create a liability for charging duty at all. So long as the goods have been manufactured in a factory and are intended for use in the factory in which they were manufactured, the exemption straight away applies." 4. The Appellants are thus eligible for the benefit of exemption under Notification No. 67/95-C.E., Accordingly, the Appeal is allowed.