2004 (5) TMI 387 - AT - Central Excise

Summary

Issues:
Confirmation of duty and imposition of personal penalty based on Notification No. 9/98-C.E. denial of benefit. Interpretation of Notification No. 9/98-C.E. regarding the availability of benefits for small scale industries.

Analysis:
The Appellate Tribunal confirmed a duty amount of Rs. 1,04,065.76 against the appellant for the period from July 1998 to November 1998, along with a personal penalty of Rs. 1,000. The confirmation was based on denying the appellant the benefit of Notification No. 9/98-C.E., dated 2-6-98, as it was held that the appellant was not availing the benefit of Notification No. 38/97 before the issuance of Notification No. 9/98. The authorities concluded that the benefit of Notification No. 9/98 for small scale industries was not available to the appellant, as they were paying duty at the full rate before the issuance of the said notification.

The Tribunal analyzed the contents of Notification No. 9/98, which exempted clearances for home consumption of specified goods from excess excise duty. The notification provided different rates of duty based on the value of clearances in a financial year. The Tribunal emphasized Note I of the notification, which clarified that clearances made before 2-6-98 under previous notifications should be considered when computing the limit for concessional rates. The Tribunal interpreted the note to mean that the benefit of Notification No. 9/98 was available regardless of the previous clearance rates or notifications availed by the assessee. The use of the term 'or' indicated that the benefit could be availed under different circumstances, with the condition that clearances before 2-6-98 would be factored into the computation of the Rs. 50 lakhs limit.

Consequently, the Tribunal set aside the impugned order, remanding the matter to the original Adjudicating Authority for reconsideration in light of their interpretation of the notification. The Tribunal held that the appellant was entitled to the benefit of clearances at concessional rates for the disputed period, with clearances made before 2-6-98 being considered after computing the Rs. 50 lakhs clearance value. The appeal was disposed of accordingly.