2004 (4) TMI 463 - AT - Central Excise

Summary

Issues Involved:
Whether the appellant can opt for availing the benefit of Notification No. 8/99-C.E. w.e.f. November, 1999.

Analysis:
The appellant, a manufacturer of gas appliances, initially opted for availing the benefit of Notification No. 9/99-C.E. for products sold under the brand name "SKN." However, they later started manufacturing gas stoves under the brand name "PAWAK" and sought to benefit from Notification No. 8/99-C.E. The Deputy Commissioner denied the exemption under Notification No. 8/99 on the grounds that the appellant had already opted for Modvat credit under Notification No. 9/99 and paid duty accordingly. The Commissioner (Appeals) upheld this decision, stating that once an option is exercised under Notification No. 9/99, it cannot be withdrawn during the remaining financial year.

The appellant argued that since they were opting for the benefit of Notification No. 8/99 for products under a different brand name, "PAWAK," the restriction specified in Notification No. 9/99 should not apply. However, the respondent contended that despite the change in brand name, the goods remained the same, and therefore, the option could not be withdrawn as per Notification No. 9/99.

Upon considering the submissions, the Tribunal noted that the goods sold under both brand names were identical. The condition in Notification No. 9/99 explicitly stated that once the option is exercised, it cannot be withdrawn during the remaining part of the financial year. Therefore, the Tribunal held that the appellant could not avail the benefit of Notification No. 8/99 in the middle of the financial year, as it would violate the terms of the notification. Consequently, the appeal was rejected.

This judgment clarifies the importance of adhering to the conditions specified in notifications regarding availing exemptions and the prohibition on withdrawing options once exercised during a financial year. It emphasizes that changes in brand names do not alter the nature of goods for which an option has been exercised under a specific notification, and such options cannot be withdrawn mid-year based on brand name variations.