2010 (8) TMI 933 - AT - Central Excise

Summary

Issues involved:
The issue involves the interpretation of Notification No. 39/2001-CE dated 31.7.2001 regarding the entitlement to benefits for a manufacturer of MS Pipes in Kutchch district of Gujarat, specifically in relation to the commencement of commercial production before 31.12.2005 and the eligibility for duty refund on coated pipes manufactured after the cut-off date.

Summary:

Issue 1: Entitlement to benefit under Notification No. 39/2001-CE

The appellant, engaged in manufacturing MS Pipes, availed benefits under the notification for a new unit set up in Kutchch district before 31.12.2005. Refund claims for duty paid were initially granted, but subsequent claims for duty on coated pipes manufactured after 31.12.2005 were rejected by authorities. The Commissioner (Appeals) upheld the rejection, stating that benefits apply only to products commencing commercial production before the cut-off date. The appellant argued that coating of pipes is a continuation of MS pipe manufacture, requesting consideration of commercial production before 31.12.2005 for coated pipes as well. However, the Tribunal rejected the appeal, emphasizing the need for separate registration for the coating unit post-31.12.2005.

Issue 2: Separate registration for PE Coating unit

The appellant sought a new registration for the PE Coating unit post-rejection of duty refund claims. The original adjudicating authority initially rejected the request, but the Commissioner (Appeals) overturned this decision, directing the grant of a new registration. The Tribunal upheld this decision, highlighting the separation of the coating unit from the bare pipe manufacturing unit and the need for distinct registrations for both units.

Decision and Conclusion:

The Tribunal acknowledged the separation of the bare pipe manufacturing unit and the PE Coating unit as distinct entities requiring separate registrations. As the coated pipes' commercial production began after 31.12.2005, the duty refund claim for those pipes was not eligible. However, considering the entitlement of the bare pipe manufacturing unit to benefits under the notification, the Tribunal allowed the refund of duty related to bare pipes cleared for coating purposes. The matter was remanded to the original adjudicating authority for the appropriate calculation and refund of duty on bare pipes from Unit No.1, in line with the notification's provisions.