2007 (10) TMI 666 - AT - Central Excise

Summary

Issues:
- Appeal under amended Section 35B of Central Excise Act, 1944
- Benefit of concessional rate of duty on cotton fabrics
- Applicability of Notifications 14/2002-C.E. and 22/96-C.E.
- Differential duty, interest, and penalty imposed by Commissioner
- Tribunal's judgment in Simplex Mills Co. Ltd. v. Commissioner of Central Excise, Mumbai

Analysis:
1. The appeal was initially dismissed for non-submission as required under the amended Section 35B of the Central Excise Act, 1944. However, the appellants later paid the fee, leading to the restoration of the appeal to its original position.

2. The appeal, involving a narrow issue, was taken up for disposal with the consent of both sides, waiving pre-deposit of differential duty and penalty imposed by the Commissioner.

3. The department contended that the appellants manufactured cotton fabrics from spinning yarn, availing duty benefits under Notification 22/96. The issue revolved around whether the appellants could avail the concessional duty rate under Notification 14/2002-C.E. for fabrics manufactured between October 2002 and March 2003.

4. After adjudication, the Commissioner ordered the appellants to pay differential duty, interest, and imposed a penalty. The appellants cited Tribunal's judgment in Simplex Mills Co. Ltd. v. Commissioner of Central Excise, Mumbai, where a similar issue was addressed.

5. The Tribunal found the appellants' case aligned with the Simplex Mills judgment, emphasizing that captive consumption was exempted under Notification 22/96. The Commissioner was deemed to have misapplied the duty rate, leading to setting aside of the impugned order and allowing the appeal.