Rhode Textile Pvt. Ltd. Vs. Commissioner of Central Excise

Rhode Textile Pvt. Ltd. vs Commissioner of Central Excise

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Mumbai Decided Sep 17, 2003

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Citation: sooperkanoon.com/32297
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Mumbai
Judge: Krishna, S T C.
Decided On: Sep 17, 2003
Subject: Service Tax

Case Summary

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

Service Tax

Key legal issue: Service Tax

Parties & Advocates

Appellant / Petitioner

Rhode Textile Pvt. Ltd.

Respondent

Commissioner of Central Excise

Excerpt

.....the main appeal.2. shri m.h. patil, learned advocate for the appellants states that the appellants manufacture made-up textile articles for which they procure duty free fabrics. the made-up articles have been exported directly abroad from their factory through merchant exporters. a question was raised whether they are entitled for procurement of duty free fabrics under notification no. 43/2001-ce (nt) since the exports were made through the merchant exporters. a clarification has been received from the ministry under letter f. no. 267/59/2002-cx.8 dated 03.12.2002 stating that it has been decided to allow the procurement of inputs without payment of duty under notification no. 43/2001-ce (nt) dated 26th june, 2001 where the exports are through merchant exporters so long as the export takes place directly from the factory of the manufacturer/processor. a copy of this clarification was sent to the commissioner of central excise, jaipur as well as to the appellants.the learned advocate points out that the commissioner of central excise, jaipur in her order confirming a duty demand of rs. 1,92,45,320/- and imposing a penalty of an equal amount apart from ordering to pay interest has ignored the said clarification from the ministry. it is the contention of the learned advocate that there has been no amendment to the law or to the relevant notification and therefore, the commissioner is not justified in saying that the clarification issued by the ministry should be applied prospectively and not for the exports already made for which the clarification was sought. the learned advocate also states that the commissioner has wrongly applied chapter 7 of the cbec manual of supplementary instruction, 2002 which refers to input stage rebate and which, in any case, does not have any legal validity as explicitly stated in para 3 of the preface to the same.3. we have also heard shri a. a. chopra, learned j.d.r. for the department.4. after hearing both sides and perusal of case.....

Full Judgment

1. After hearing both sides for some time, we find that the appeal itself can be disposed of at the stay stage itself, As such, we waive the pre-deposit of duty and penalty and proceeded to hear the main appeal.

2. Shri M.H. Patil, learned advocate for the appellants states that the appellants manufacture made-up textile articles for which they procure duty free fabrics. The made-up articles have been exported directly abroad from their factory through Merchant Exporters. A question was raised whether they are entitled for procurement of duty free fabrics under Notification No. 43/2001-CE (NT) since the exports were made through the Merchant Exporters. A clarification has been received from the Ministry under letter F. No. 267/59/2002-CX.8 dated 03.12.2002 stating that it has been decided to allow the procurement of inputs without payment of duty under Notification No. 43/2001-CE (NT) dated 26th June, 2001 where the exports are through merchant exporters so long as the export takes place directly from the factory of the manufacturer/processor. A copy of this clarification was sent to the Commissioner of Central Excise, Jaipur as well as to the appellants.

The learned advocate points out that the Commissioner of Central Excise, Jaipur in her order confirming a duty demand of Rs. 1,92,45,320/- and imposing a penalty of an equal amount apart from ordering to pay interest has ignored the said clarification from the Ministry. It is the contention of the learned advocate that there has been no amendment to the law or to the relevant notification and therefore, the Commissioner is not justified in saying that the clarification issued by the Ministry should be applied prospectively and not for the exports already made for which the clarification was sought. The learned advocate also states that the Commissioner has wrongly applied Chapter 7 of the CBEC Manual of Supplementary Instruction, 2002 which refers to input stage rebate and which, in any case, does not have any legal validity as explicitly stated in para 3 of the preface to the same.

3. We have also heard Shri A. A. Chopra, learned J.D.R. for the department.

4. After hearing both sides and perusal of case records, we find that there is no allegation against the appellants of not using the duty free fabrics.

5. In view of our findings that the Ministry has specifically clarified that direct exports made by the appellants from their factory through merchant exporters are entitled to procurement of duty free inputs under Notification No. 43/2001, we set aside the impugned order and allow the appeal.

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Mumb... Same Parties Rhode Textile Pvt. Ltd. vs Commissioner of Central Excise Same Subject Service Tax Same Judge Krishna, S T C.