2015 (1) TMI 78 - HC - Central Excise

Benefit of the Notification 23/2003 - Benefit to imported resin, Tenax paste and Hardner - As per Notification, goods manufactured wholly from imported raw materials and cleared by an EOU to DTA are exempted from the duty of excise equal to that leviable on such goods manufactured and cleared by other DTA units - what will be the rate of duty that is payable by the first respondent - Held that - it is apparent that the question as to the applicability of a notification or a circular which has a bearing on the determination of the rate of duty is a question which has a direct and proximate relationship to the rate of duty and to the value of goods for purposes of assessment. In the circumstances, the present appeal which relates to the applicability of the above referred circular, relates directly to the determination of rate of duty for the purpose of assessment and as such, in the light of the provisions of Section 35G read with Section 35L of the Act, this Court has no jurisdiction to entertain the appeal. - Following decision of Commissioner of Central Excise v. JBF Industries Ltd. 2010 (12) TMI 437 - GUJARAT HIGH COURT - appeal is not maintainable and accordingly, the same is dismissed giving liberty to the appellant to pursue the matter before the appropriate forum - Decided against Revenue.

Summary

Issues:
1. Classification of imported goods as raw materials or consumables.
2. Eligibility for exemption under Notifications 8/97 and 23/2003.

Analysis:
1. The case involved a dispute over the classification of imported goods used in the manufacturing process as raw materials or consumables. The Department contended that the goods were raw materials and not consumables, leading to a denial of exemption benefits. The Adjudicating Authority upheld this view, stating that since the goods were used as raw materials and the final product was not wholly manufactured from indigenous raw materials, the exemption could not be extended. The Commissioner (Appeals) affirmed this decision, resulting in the assessee appealing to the Tribunal.

2. The Tribunal, citing precedents, allowed the appeal, determining that the resin and hardner in question were consumables distinct from raw materials. It emphasized that the use of imported consumables did not disqualify an Export Oriented Unit (EOU) from exemption benefits under the relevant notification. Dissatisfied with the Tribunal's decision, the Revenue approached the High Court, raising substantial questions of law for consideration.

3. During the High Court proceedings, the counsel for the assessee objected to the appeal's maintainability based on Section 35G of the Central Excise Act, 1944. Citing the Supreme Court's decision in Navin Chemicals Manufacturing and Trading Co. Ltd. v. Collector of Customs, the counsel argued that questions related to the rate of duty or value of goods for assessment did not fall under the High Court's jurisdiction. The High Court agreed with this stance, highlighting that the core issue revolved around the interpretation of Notification No. 23/03-CE and its impact on the duty payable by the assessee.

4. Drawing support from a Gujarat High Court decision, the High Court concluded that the appeal was not maintainable as it directly concerned the determination of the rate of duty, which fell outside its purview under Section 35G of the Act. Therefore, the High Court dismissed the appeal, granting the appellant the liberty to pursue the matter in the appropriate forum.