2002 (2) TMI 446 - AT - Central Excise

Summary

Issues:
1. Waiving pre-deposit of duty and penalty.
2. Interpretation of Notification No. 175/86 regarding clubbing of clearances.
3. Application of SSI exemption to all units of a company.

Analysis:

1. Waiving Pre-Deposit of Duty and Penalty:
The Appellate Tribunal considered the appeal filed by M/s. Plyboard Industries Ltd. along with a Stay Petition requesting the waiver of pre-deposit of duty amounting to Rs. 22,63,878 and a penalty of Rs. 5,000. The counsel for the appellant argued that the company, engaged in manufacturing plywood and related products, had already deposited Rs. 5.0 lac with the Department. The Tribunal, after hearing both sides, decided to waive the pre-deposit of duty and penalty, allowing the matter to be remanded back to the Commissioner of Central Excise for further examination.

2. Interpretation of Notification No. 175/86 - Clubbing of Clearances:
The main contention in the case was whether the clearances of various factories owned by Jammu and Kashmir Industries should be clubbed, thus disallowing the small scale exemption under Notification No. 175/86 for M/s. Plyboard Industries Ltd. The counsel argued that the appellant company is a separate legal entity maintaining its own financial accounts and balance sheet, and hence, the clearances of other units should not be clubbed. Citing a previous Tribunal decision in the case of TANSI v. CCE, it was emphasized that the SSI exemption should be applicable to all units of a company.

3. Application of SSI Exemption to All Units of a Company:
The Tribunal referred to Explanation V in Notification No. 175/86, which states that the value of excisable goods cleared from a factory belonging to a government entity shall be taken into account. The counsel highlighted that the appellant company had applied for registration, submitted all relevant information, but did not receive a license. The Tribunal, after considering the submissions and relevant case law, concluded that the matter required further examination in the light of Explanation V to Notification No. 175/86 and the precedent set by the Tribunal in the TANSI case. Consequently, the appeal was allowed by way of remand, directing the Commissioner of Central Excise to reevaluate the case.

In summary, the judgment by the Appellate Tribunal CEGAT, New Delhi involved issues related to waiving pre-deposit of duty and penalty, interpretation of Notification No. 175/86 regarding clubbing of clearances, and the application of SSI exemption to all units of a company. The Tribunal decided to remand the matter back to the Commissioner of Central Excise for further examination in light of the relevant legal provisions and precedents cited during the proceedings.