2002 (1) TMI 1178 - AT - Central Excise

Summary

Issues:
- Interpretation of Notification No. 67/95 regarding exemption from excise duty.
- Applicability of CBEC Circular No. 278/112/96-CX.
- Liability for payment of additional excise duty on exported goods.

Interpretation of Notification No. 67/95 regarding exemption from excise duty:
The case involved the interpretation of Notification No. 67/95, which grants exemption from the payment of basic excise duty only. The dispute arose as the Revenue contended that the exemption did not extend to additional excise duty. The respondents claimed that all goods manufactured were exported under bond, entitling them to the benefit of Notification No. 47/94 for removal without payment of duty. The Tribunal noted the lack of a clear finding in the impugned order regarding whether processed fabrics were used in the manufacture of exported made-up articles. Consequently, the Tribunal remanded the case to the Commissioner (Appeals) for verification of the claim of 100% export under bond. If verified, no additional excise duty would be levied; however, if made-up articles were cleared domestically, additional excise duty would apply as per the Notification.

Applicability of CBEC Circular No. 278/112/96-CX:
The Revenue argued that the CBEC Circular No. 278/112/96-CX, which dealt with the payment of additional duty of excise on goods exported under bond, was not applicable to clearances under exemption, unlike the present case. The Commissioner (Appeals) had set aside the Adjudicating Authority's orders based on this circular and the fulfillment of Rule 13(1)(b) and Notification 47/94 requirements. The Tribunal did not directly address the applicability of the circular but focused on the specific facts of the case regarding the export under bond and the liability for additional excise duty.

Liability for payment of additional excise duty on exported goods:
The core issue revolved around the liability for additional excise duty on goods exported under bond by the respondents. While the Revenue did not contest that additional excise duty was not applicable to such exports, the dispute arose from the interpretation of the exemption notifications. The Tribunal emphasized the need for verification of whether the goods were indeed exported under bond to determine the applicability of additional excise duty. The decision to remand the case for further verification by the Commissioner (Appeals) was based on this crucial aspect to ascertain the correct levy of duties.

In conclusion, the Tribunal allowed the appeals by remanding the case for fresh decision by the Commissioner (Appeals) to clarify the export under bond aspect and determine the liability for additional excise duty based on the specific circumstances of the case.