2014 (8) TMI 1104 - AT - Central Excise

Manufacture - whether the goods manufactured by assessee, not obtained by the process mentioned in Chapter Note 1 to Chapter 54 will be excisable? - Held that - the final product manufactured by the appellant is not obtained by the process mentioned in Chapter Note 1 to Chapter 54 of CCETA, 1985. Therefore, there is no hesitation to follow the decision of GPL Polyfils Ltd. 2005 (1) TMI 375 - CESTAT, NEW DELHI to hold that the finished goods manufactured by the appellant does not fall under Chapter 54 or 55 of the CETA, 1985 - demand for the period 1-11-2009 to 28-6-2010 not sustainable. As per the amendment in the FA, 2014, the manufactured product of the appellant which has been obtained from the input plastic waste has been exempted from 29-6-2010 to 16-3-2012. Therefore, the demands for the period 29-6-2010 to 31-3-2012 are also not sustainable. Appeal allowed - decided in favor of assessee.

Summary

Issues:
- Restoration of appeal due to non-compliance of stay order
- Classification of finished goods under Central Excise Tariff Act, 1985
- Exemption of goods manufactured from plastic waste

Restoration of Appeal:
The appellant filed for Restoration of Appeal after the Tribunal initially dismissed their appeal for non-compliance of the stay order. The Hon'ble High Court of Bombay set aside the stay order passed by the Tribunal and directed a reconsideration of the stay application by the Tribunal. The order of dismissal of the appeal was recalled in light of this development, and the appeal and stay applications were restored to their original numbers.

Classification of Finished Goods:
The appellant, a manufacturer of polyester staple fibre and polyester filament fibre, availed benefits under Notification No. 4/2006, clearing goods without duty payment. The Revenue contended that the finished product fell under Chapter Heading 54/55 of the Central Excise Tariff Act, 1985, necessitating duty payment. Show cause notices were issued for various periods, demands were confirmed, and penalties imposed. The appellant argued that their finished goods did not fall under Chapter 54 or 55, citing relevant legal provisions and circulars. The Tribunal found that the appellant's finished goods did not meet the classification criteria under Chapter 54, rendering the demands unsustainable.

Exemption of Goods from Plastic Waste:
The Tribunal noted amendments in the Finance Act exempting goods manufactured from plastic waste. The demands for the period 29-6-2010 to 31-3-2012 were deemed unsustainable under the amended provisions. Consequently, the demands of duty, interest, and penalties confirmed against the appellant were set aside. The appeals were allowed with consequential relief, and stay applications were disposed of accordingly.