1998 (3) TMI 627 - AT - Central Excise

Summary

Issues:
- Entitlement to benefit under Notification No. 281/86
- Claiming benefit under Notification No. 217/86 for the first time

Entitlement to benefit under Notification No. 281/86:
The appeal was filed against the order of the Collector (Appeals) denying the appellants the benefit of Notification No. 281/86 dated 24-4-86. The Collector (Appeals) held that the exemption under this notification required both the manufacture of goods in a workshop within a factory and that the goods must be intended for use in the factory premises only. Since the goods in question were also being sold to outside parties, the exemption was deemed unavailable. The appellants contended that since they manufactured goods used for repairs within the factory, they should be entitled to the benefit of the notification. However, the lower authorities upheld the denial of the benefit under Notification No. 281/86.

Claiming benefit under Notification No. 217/86 for the first time:
The appellants, represented by a consultant, argued that if they were not entitled to the benefit of Notification No. 281/86, they should be allowed the benefit of Notification No. 217/86. The consultant cited precedents where similar issues were addressed by the Tribunal in other cases. The Revenue representative argued that the concession under Notification No. 281/86 was not applicable as the goods were not wholly intended for use in the factory machines and were also sold outside. Regarding Notification No. 217/86, it was highlighted that this notification had not been previously relied upon by the assessees. The Tribunal found merit in the Revenue's arguments and held that the appellants did not comply with the material requirement of Notification No. 281/86. However, since the benefit under Notification No. 217/86 was being claimed for the first time, the Tribunal decided to remand the case to the Assistant Collector for further examination of the admissibility of the exemption under this notification, providing the appellants with an opportunity to be heard in person. Consequently, the appeal was allowed by remand for detailed consideration of the benefit under Notification No. 217/86.