2006 (3) TMI 369 - AT - Central Excise

Summary

Issues: Denial of exemption under Notification No. 1/95-C.E. for goods cleared to 100% EOU due to CT-3 certificates not in appellant's name.

Analysis:
1. The appellants, holders of Central Excise registration certificate for manufacturing goods under Chapters 72 & 84 of the CETA, 1985, were denied the benefit of exemption under Notification No. 1/95-C.E. The denial was based on the grounds that although goods were cleared to 100% EOU M/s. Orchid Chemicals & Pharmaceutical Ltd., the CT-3 certificates were only endorsed in the appellant's name by M/s. Excelsior Design & Projects Consolidated Pvt. Ltd. An endorsed CT-3 certificate was deemed invalid as a duty paying document, resulting in a duty demand of Rs. 88,500. The appellants failed to establish their claim by not providing the relevant CT-3 certificate for verification, leading to the dismissal of their plea. The denial of benefit was upheld, and the appeal was rejected.

2. Despite the appellants' argument that a specific CT-3 certificate in their name (No. 217 dated 22-12-1994) was relevant for goods clearance, the absence of this certificate's submission hindered their case. The Tribunal noted that the relevant CT-3 certificate was actually No. 208 dated 15-12-1994, not in their favor. Consequently, the claim regarding clearance under CT-3 No. 217 was unsubstantiated and rejected. Additionally, the contention that endorsing CT-3 certificates is permissible, thus challenging the duty demand of Rs. 28,550 for CT-3 No. 216 dated 22-12-1994, was dismissed. The Tribunal emphasized that there is no provision for endorsement of CT-3 certificates, and the law does not recognize such endorsements as valid duty paying documents. Therefore, the plea based on procedural grounds was deemed unacceptable, leading to the rejection of the appeal.

3. The appellants' argument that the benefit of the Notification should not be denied solely due to the CT-3 certificate not being in their name and only endorsed to them was refuted. The Tribunal clarified that CT-3 certificates serve as duty paying documents, and the law does not permit endorsements on these certificates. Consequently, the absence of the certificate in the appellant's name was not considered a procedural lapse but a substantive issue. The Tribunal found no merit in the appeal, affirmed the impugned order, and upheld the denial of the benefit under the Notification.