Full Judgment
2. Shri R. Krishnanan, learned Advocate, submitted that out of the total duty confirmed, the Appellants are not disputing the duty amounting to Rs. 1,32,363/- which has also been paid by them and has not been taken into consideration while confirming the duty under the impugned Order. He, further, submitted that the goods involving duty amounting to Rs. 38,432/- had been cleared by them without payment of duty to the hospitals in respect of which there is no requirement of producing the re-warehousing certificate; that the Commissioner (Appeals) himself has not confirmed such demand in his earlier Order-in-Appeal No. 964/2001 dated 21.11.2001; that accordingly duty in respect of supplies made to the hospitals is not liable to be paid for non-submission of re-warehousing particulars. Regarding remaining amount of duty the learned Advocate mentioned that the goods were supplied by them to the 100% E.O.U. in respect of which they have submitted the re-warehousing particulars after the stipulated period of 90 days; that the delay in obtaining the re-warehousing certificate cannot stand in the way of accepting the fact of re-warehousing; that the spirit of the Rule is that the goods cleared without payment of duty against CT-3 should be warehoused and the period prescribed for this purpose cannot be so strictly construed as to deny the benefit of factum of warehousing.
3. Countering the arguments Shir H.C. Verma, learned D.R., submitted that the benefit of Notification is available to a manufacturer subject to the fulfillment of the conditions stipulated in the Notification; Hint if the condition stipulated in the Notification is not fulfilled the benefit of the Notification will not be available; that it has been held by the Supreme Court in the case of Eagle Flask Industries Ltd. v.CCE, Pune 2004 (64) RLT 363 (SC) : 2004 (116) ECR 200 (SC) that for availing the benefit under exemption notification conditions have to be strict complied with and it cannot be said that the conditions are mere procedural requirement, with no consequences attached for nonobservance; that the Supreme Court has held that the consequences are denial of benefits under the Notification.
4. We have considered the submissions of both the sides. As the Appellants are not disputing the demand of duty amounting to Rs. 1,32,363/- the same is upheld. The Revenue has not rebutted the contention of the Appellants that the Commissioner (Appeals) has allowed the clearance of the goods to the hospital without payment of duty and re-warehousing particulars are not to be submitted for such supplies. However, we observe that the material brought on record does not indicate that the goods involving duty amounting to Rs. 38,432/- were supplied to the hospitals, etc. This fact has to be determined by the Adjudicating Authority. We, therefore, remand the matter pertaining to the goods involving duty of Rs. 38,432/- to the Adjudicating Authority for re-examining and deciding the matter as to whether these goods were supplied to the hospital.
5. Regarding remaining demand of duty Rs. 1,69,356/- it has not been disputed by Revenue that the re-warehousing particulars have been received though after 90 days. The condition stipulated in Notification No. 1/95-CE dated 4.1.1995 which provides exemption to the goods supplied to a 100% E.O.U. is that the manufacturer of the goods follows the procedure contained in Rule 156A and 156B of the Central Excise Rules, 1944. Rule 156B provides that in case the certificate of re-warehousing is not received back by the consignor within 90 days of the removal of the goods or such extended period as the Commissioner may allow the consignor shall pay the duty leviable on the goods. The Rule, further, provides that where such duty has been paid and proof of re-warehousing is produced by the consignor to the satisfaction of the proper officer, such consignor may be entitled to a refund of the duty so paid. A perusal of Rule 156B makes it apparent that the Commissioner is empowered to extend the period. It also makes clear that even if the duty has been paid as the certificate of re-warehousing his not been received and the same is received subsequently the consignor is entitled to file a refund claim. It is thus apparent that the condition of 90 days for producing certificate of re-warehousing is flexible. As in the present matter admittedly the Appellants had produced the re-warehousing certificate which has not been doubted by Revenue, no duty is payable by the Appellants. We, therefore, set aside the duty amounting to Rs. 1,69,356/- The appeal is disposed of in these terms.