2004 (11) TMI 456 - AT - Central Excise

Summary

Issues:
Classification under Notification No. 23/94 denied due to availing benefit under Notification No. 1/93.

Analysis:
The appellants, engaged in the manufacture of paper and paperboard, initially claimed the benefit of Notification No. 1/93 in their classification list effective from 1-3-94, which was approved by the proper officer. Subsequently, they filed another classification list effective from 1-4-94, seeking the benefit of Notification No. 23/94. A show cause notice was issued proposing denial of the exemption under Notification No. 23/94 on the basis that the exemption is not available to manufacturers who avail the benefit under Notification No. 1/93. The Assistant Commissioner adjudicated the notice, noting that the appellants were not simultaneously availing the benefit of Notification No. 1/93 and thus approved the classification, extending the benefit of the notification as claimed.

The Revenue challenged the Assistant Commissioner's decision before the Commissioner (Appeals), who reversed the order and allowed the Revenue's appeal. The matter was brought before the Appellate Tribunal, where arguments were presented by the representatives of both the Revenue and the appellant. The Tribunal examined paragraph 2(c) of Notification No. 23/94, which states that the exemption does not apply to manufacturers who avail of the exemption under Notification No. 1/93. The Commissioner had interpreted this paragraph to deny the benefit even if the appellants had previously availed the benefit of Notification No. 23/94. However, the Tribunal disagreed with this interpretation, emphasizing that the appellants were not availing the benefit of Notification No. 1/93 during the relevant period when they made their claim under Notification No. 23/94. As both notifications were issued under section 5(A) of the Central Excise Act, the assessee had the option to choose between them unless there was a specific condition prohibiting simultaneous availment. The purpose of clause 2(c) of Notification No. 23/94 was to prevent simultaneous availment of both notifications. Consequently, the Tribunal set aside the Commissioner (Appeals)'s order and allowed the appeal by reinstating the Assistant Commissioner's decision.

In conclusion, the Tribunal ruled in favor of the appellant, holding that the benefit of Notification No. 23/94 could not be denied to them as they were not availing the benefit of Notification No. 1/93 during the relevant period. The Tribunal's decision was based on the interpretation of the relevant notification clauses and the absence of simultaneous availment of the exemptions in question.