9911796707
|
Home
Issues:
1. Whether the Appellant is liable to pay cess for manufacturing textiles from a powerloom? 2. Interpretation of the definition of powerloom and processing unit in relation to textile manufacturing. Issue 1: The Appellant contested a Demand Notice for cess payment, arguing exemption as textiles were manufactured from a powerloom, citing the proviso to Section 5A(1) exempting textiles from handloom or powerloom industry. The Appellant relied on Circular No. 55(2)/73-AC listing cess on specific textiles. Case laws were cited to support that cess need not be paid if already done. However, the Respondent contended that being a processing unit, the Appellant is not exempt from cess payment, referring to a Delhi High Court judgment. The Tribunal noted that prior cess payment exempts subsequent payments, ultimately allowing the Appeal due to the Appellant's exemption under the proviso. Issue 2: The Tribunal delved into the definition of powerloom and textile under the Textile Committee Act, 1963. It highlighted the distinction between powerloom and textile, raising a query on the meaning of "process" concerning textiles. The Tribunal analyzed the term "process" as a series of actions on an original item, concluding that processing units like the Appellant do not qualify as manufacturers from a powerloom. Consequently, processing does not align with the powerloom definition, leading to the Appellant being held liable to pay the cess. Additionally, the Tribunal found discrepancies in the Demand Notice, as the Appellant was not given an opportunity to be heard as mandated by the Textile Committee (Cess) Rules, 1975, rendering the Notice unsustainable under law and thus set it aside, ultimately allowing the Appeal.
|
