2009 (6) TMI 904 - AT - Central Excise

Summary

Issues involved: Determination of eligibility for exemption u/s Notification No. 7/2003-C.E. and consideration of export for exemption from excise duty.

Eligibility for exemption u/s Notification No. 7/2003-C.E.: The Commissioner concluded that unprocessed Hand Woven Fabrics are not non-excisable as per Tariff Heading 5207 and 5208 or Chapter Notes under Chapter 52. The exemption under Sl. No. 29 of Notification No. 7/2003-C.E. would not apply to goods that do not conform to specified specifications.

Consideration of export for exemption: The appellant claimed that the goods subject to duty were supplied to various entities for export, including M/s. Hindustan Textiles, M/s. Zanav Home Collections, and M/s. Shyam Ahuja. The appellant argued that the lack of corroborative evidence of export should not preclude exemption, as exports were facilitated through recognized export houses. The appellant provided statements and certificates from M/s. Hindustan Textiles and M/s. Zanav Home Collection to support their export claims. The Tribunal directed the Original Authority to grant exemption based on the evidence of export provided by the appellant, with duty applicable only to quantities not covered by such evidence. The revenue was tasked with demonstrating the inaccuracy of the appellant's evidence within four months.

Conclusion: The Tribunal upheld the finding that unprocessed handloom fabrics were liable to excise duty in the absence of relevant exemption notification. However, the Tribunal directed the Original Authority to grant exemption based on evidence of export provided by the appellant, with duty payable only on quantities not supported by such evidence. The appeal was disposed of with the matter remanded to the Original Authority for further action within a specified timeframe.