2006 (12) TMI 350 - AT - Central Excise

Summary

Issues:
1. Calculation of duty liability based on the inclusion of captive clearance value in the aggregate value of clearances for SSI benefit.

Analysis:
The case involved the appellants, engaged in manufacturing excisable goods, specifically monofilament twine, utilizing monofilament yarn as an intermediate product for captive consumption. The dispute arose when the department challenged the appellants' calculation of clearances of specified goods for SSI benefit, as they excluded the value of monofilament yarn cleared for captive consumption. The original authority confirmed a duty demand and imposed a penalty, which was upheld by the Commissioner (Appeals), leading to the present appeal.

Upon review, the Tribunal considered the question of whether captive clearance value should be included in the aggregate value of clearances for determining duty liability under SSI exemption Notifications. Referring to a previous decision in a similar case, the Tribunal had ruled in favor of the assessees, stating that captive clearance value should not be included in the aggregate value of clearances of specified goods. Consequently, the Tribunal found no fault with the appellants' exclusion of captive clearance value during the disputed period to claim SSI benefit under the relevant Notification.

In light of the precedent and the interpretation of the relevant Notifications, the Tribunal set aside the impugned order denying SSI benefit to the assessee and allowed the appeal, emphasizing that the captive clearance value should not be considered in calculating duty liability for SSI exemption. The judgment provided clarity on the treatment of captive clearance value in such scenarios, ensuring consistency in applying SSI benefits to manufacturers utilizing intermediate products for captive consumption.