2004 (3) TMI 593 - AT - Central Excise

Issues:
1. Appeal against extension of benefit of Notification No. 6/2000-C.E., Sr. No. 242 to the Respondent.
2. Disallowance of Small Scale benefit to the manufacturer.
3. Claiming exemption under Notification No. 8/2000-C.E.
4. Dispute regarding the eligibility to avail exemption benefits of Notification No. 6/2000-C.E.
5. Interpretation of the relevant notifications and classification of goods.

Analysis:
1. The appeal was filed by the Revenue against the extension of the benefit of Notification No. 6/2000-C.E., Sr. No. 242 to the Respondent, M/s. Arvind Chemicals Ltd. The Respondents manufactured mattresses of coir, P.U. foam, and Re-bonded P.U. foam and claimed exemption under Notification No. 8/2000-C.E. The Asst. Commissioner disallowed the benefit of the said Notification on the grounds of clearing goods bearing another brand name. However, the Commissioner (Appeals) extended the benefit of Notification No. 6/2000-C.E. The Revenue argued that the Respondents never claimed exemption under Notification No. 6/2000, and it was not the subject matter of the show cause notice. The Tribunal found that the Respondents had pointed out that their product attracted nil rate of duty under Notification No. 6/2000, and since the Adjudicating Authority did not discuss this, the benefit was rightfully extended by the Commissioner (Appeals).

2. The issue of Small Scale benefit not being admissible to the manufacturer was raised. The Adjudicating Authority correctly held that Small Scale benefit was not admissible, but the Commissioner (Appeals) extended the benefit of Notification No. 6/2000-C.E. The Tribunal noted that the Adjudicating Authority did not discuss or decide on the appellants' eligibility to avail exemption benefits under Notification No. 6/2000-C.E. The Respondents had specifically mentioned that their product attracted nil rate of duty under this notification, which should have been considered by the Adjudicating Authority.

3. The Respondents claimed exemption under Notification No. 8/2000-C.E., but the Asst. Commissioner disallowed it. The Commissioner (Appeals) extended the benefit of Notification No. 6/2000-C.E. The Tribunal found that the Respondents had correctly pointed out the nil rate of duty under Notification No. 6/2000 for their product, and the Adjudicating Authority should have discussed this aspect.

4. The dispute regarding the eligibility to avail exemption benefits of Notification No. 6/2000-C.E. was a crucial point of contention. The Adjudicating Authority did not discuss or decide on the eligibility of the Respondents to avail the exemption benefits under this notification, even though the Respondents had specifically mentioned the nil rate of duty applicable to their product under this notification. The Commissioner (Appeals) rightly extended the benefit as the Adjudicating Authority had not addressed this issue.

5. The interpretation of the relevant notifications and the classification of goods played a significant role in the judgment. The Tribunal found that the goods manufactured by the Respondents fell under the category of rubberized coir mattresses attracting nil rate of duty under Notification No. 6/2000-C.E. The Tribunal upheld the decision of the Commissioner (Appeals) as the Respondents' claim for exemption under this notification was valid based on the nature of their manufactured goods.

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