2011 (1) TMI 294 - AT - Central Excise

Penalty - manufacture of ingots of non-alloy steel classifiable under Chapter sub-heading no.7206.90 Exemption notification - notification was amended under Notification No.59/97-CE ingots and billets as final products classifiable under sub-heading no.7206.90 and 7207.90 were exempted from the applicability of the exemption notification Appellant claim the benefit of the said exemption notification, show cause notice dated 17.09.2003 came to be issued to the appellants which was sought to be contested by the appellants - appellant was not entitled for the benefit of the exemption notification Appeal dismissed

Summary

Issues:
1. Interpretation of Notification No.67/95-CE dated 16.03.95 regarding exemption of excisable goods.
2. Eligibility of the appellants for exemption under the Compounded Levy Scheme.
3. Contravention of the exemption notification by the appellants.
4. Adjudication of the demand confirmed against the appellants.

Analysis:
The appeal before the Appellate Tribunal CESTAT, New Delhi stemmed from an order passed by the Commissioner (Appeals), Allahabad, dismissing the appellant's appeal against the adjudicating authority's decision confirming a demand of Rs.21,384/- along with interest and penalty. The appellants, engaged in manufacturing ingots of non-alloy steel, were working under the Compounded Levy Scheme during a specific period. A notification exempting excisable goods from duty was amended to exclude ingots and billets as final products, affecting the benefit of exemption for inputs used in their manufacture. The show cause notice issued to the appellants for contravening the exemption notification led to the confirmation of the demand, upheld by the Commissioner (Appeals).

The Tribunal observed that the exemption notification clearly excluded inputs used in manufacturing ingots and billets of non-alloy steel from availing the exemption. Since the appellants were manufacturing ingots of non-alloy steel falling under the specified sub-heading, the Tribunal found no grounds for interference with the lower authorities' decisions. Additionally, the Tribunal referred to a Board Circular clarifying the appellant's ineligibility for the exemption, supporting the dismissal of the appeal.

In conclusion, the Tribunal upheld the lower authorities' decisions, emphasizing the exclusion of inputs for ingots and billets from the exemption notification and the clarity provided by the Board Circular. The appeal was dismissed based on the non-entitlement of the appellants for the benefit of the exemption notification, as highlighted in the Circular and the specific provisions of the notification itself.