2005 (8) TMI 424 - AT - Central Excise

Summary

Issues:
1. Duty-free clearance of polyester yarn for export under AR4s.
2. Denial of duty-free clearance to the appellants.
3. Appeal against Order-in-Appeal No. 237/2004-C.E.
4. Bar under the first proviso to sub-section (1) of Section 35B.
5. Correct advice to move the Central Government under Section 35EE.
6. Dismissal of the appeal as not maintainable.

Analysis:
1. The appellants, manufacturers of polyester blended yarn, cleared quantities for export without duty payment under AR4s in January 1998. The department discovered that the merchant-exporters to whom the clearances were made were not authorized for duty-free clearance, leading to a proposal to deny the benefit to the appellants. This dispute culminated in an order by the Commissioner (Appeals) confirming the duty demand against the appellants and imposing a penalty of Rs. 5,000. The appeal in question challenges Order-in-Appeal No. 237/2004-C.E., dated 30-4-2004.

2. The appeal faced a challenge based on the first proviso to sub-section (1) of Section 35B, which restricts appeals to the Tribunal against orders related to goods exported without duty payment. The Commissioner (Appeals) correctly advised the appellants in the impugned order to seek recourse under Section 35EE of the Central Excise Act if aggrieved. The goods were exported to Hong Kong without excise duty, making the appeal not maintainable before the Tribunal but requiring an application for revision under Section 35EE to the Central Government.

3. The Tribunal dismissed the appeal as not maintainable due to the restrictions under the law. The appellants were directed to utilize Section 35EE of the Central Excise Act against the impugned order. Despite pursuing the wrong remedy in good faith, any delay in filing an application under Section 35EE was expected to be condoned by the revisional authority for the sake of justice. The judgment emphasized the importance of following the correct legal procedures and remedies as prescribed by law.