2003 (1) TMI 616 - AT - Central Excise

Summary

Issues: Eligibility to duty of copper billets, liability of employees to penalty, benefit of exemption under Notification 178/86, interpretation of circulars affecting duty payment, applicability of previous judgments, consideration of limitation period.

The judgment by the Appellate Tribunal CEGAT, Mumbai, involved a consideration of the eligibility to duty of copper billets manufactured by a company for use in pipes and tubes production, and the liability of employees to penalty. The Commissioner had denied the exemption claimed under Notification 178/86 due to non-compliance with conditions requiring the final product to be cleared on payment of duty. The appellants argued that the exemption under Notification 178/86 should be granted even if not claimed in the classification list, citing precedent from Venus Tyres Pvt. Ltd. v. CCE. The Tribunal noted that the billets were classifiable as refined copper and unwrought copper, meeting the criteria of the notification. The requirement that the goods are made from copper on which duty has already been paid was contested, with the appellants claiming that duty exemption certificates covered the imported copper bars used in manufacturing. Circulars 107/4/92-CX.3 and 345/15/87-TRU were referenced to support the interpretation that "duty already paid" includes cases of "nil duty paid" under exemption notifications. The Tribunal applied the principle from a Supreme Court judgment in CCE v. Dhiren Chemical Industries, emphasizing that the department must adhere to circulars issued by the Board. Consequently, the benefit of the exemption was upheld, and the question of limitation was not addressed. The appeals were allowed, and the impugned order was set aside, ruling in favor of the appellants.