2006 (9) TMI 306 - AT - Central Excise

Summary

Issues:
1. Waiver of duty amounting to Rs. 7,65,201 demanded by the impugned order of the Commissioner (Appeals).
2. Entitlement for simultaneous availment of benefit of SSI value-based exemption clearance of unbranded goods and benefit of availment of Cenvat credit for inputs used in the manufacture of goods bearing other's brand name.

Analysis:
1. The appeal focused on the waiver of duty amounting to Rs. 7,65,201 demanded by the Commissioner (Appeals). The limited issue to be decided was whether the applicant is entitled to simultaneous availment of the benefit of SSI value-based exemption clearance of unbranded goods and the benefit of availment of Cenvat credit for inputs used in the manufacture of goods bearing other's brand name. The applicant had been availing SSI exemption and dealing with goods for both export and home consumption. It was clarified that the bar of not availing Cenvat credit is only in respect of goods cleared for home consumption, not for export. The Board's circular also emphasized the need for separate accounts to avail simultaneous benefits, which the applicants had maintained. The demand was deemed unsustainable based on these arguments.

2. The Tribunal considered the submissions and noted that Cenvat credit was taken only for clearance effected for export, not for goods cleared for home consumption, as per the provisions of Notification No. 8/03. The Tribunal found that the lower Authorities had overlooked this crucial distinction. Consequently, the Tribunal found that the applicants had established a prima facie case in their favor. As a result, the Tribunal dispensed with the pre-deposit of duty and stayed the recovery until the appeal's final disposal. The decision was based on the clear distinction between goods cleared for export and those cleared for home consumption, allowing the applicants to benefit from the SSI exemption and Cenvat credit simultaneously.

This detailed analysis of the judgment highlights the key issues and the Tribunal's reasoning behind the decision regarding the waiver of duty and entitlement to simultaneous benefits under the SSI exemption and Cenvat credit schemes.