2015 (6) TMI 45 - AT - Central Excise

Exemption claim - Captice consumption - whether National Calamity Contingency Duty (NCCD) is leviable on Partially Oriented Yarn (POY) and FDY when used captively in the manufacture of the goods falling under CETH 54.02 exempted under Notification No.46/2003-CE, dt.17.05.2003 - Held that - the judgment of the Tribunal 2008 (12) TMI 722 - CESTAT AHMEDABAD in relation to clearance under Notification No.108/95 can be applied and therefore, NCCD is not leviable in respect of clearance to 100% EOUs also. - Decided in favour of assessee.

Summary

Issues:
Leviability of National Calamity Contingency Duty (NCCD) on Partially Oriented Yarn (POY) and Fully Drawn Yarn (FDY) when used captively in manufacturing goods exempted under Notification No.46/2003-CE.

Analysis:
The appeal was filed questioning the confirmation of the Order-In-Appeal (OIA) by the first Appellate Authority regarding the levy of NCCD on POY and FDY when used captively in manufacturing. The main issue revolved around whether NCCD is applicable in such captive consumption scenarios for goods falling under CETH 54.02 exempted under Notification No.46/2003-CE. The Appellant argued that NCCD should not be imposed on captively consumed POY and FDY, citing previous Tribunal decisions like M/s Modern Petrofils cases. The Respondent defended the order, emphasizing that the exemption under Notification No.67/95-CE does not apply to captively consumed POY when the end product is chargeable to Nil NCCD rate.

Upon hearing both sides, the Tribunal delved into the issue of NCCD levy on captively consumed POY. The Appellant relied on the case law of Modern Petrofils Ltd to support their argument. The Tribunal referenced previous orders and decisions, including the case of M/s Modern Petrofils Ltd, where it was established that NCCD is not leviable on captively consumed POY. The Tribunal found the facts of the case aligned with previous decisions and allowed the appeal filed by the Appellant, granting consequential relief.

The Tribunal's analysis highlighted that the Appellant's case involved supplying POY to 100% EOUs and captive consumption, similar to previous cases like Modern Petrofils Ltd. The Tribunal followed the same legal reasoning as in earlier cases, such as Modern Petrofils Ltd and M/s Filatex India Ltd, to conclude that NCCD is not applicable in such scenarios. By applying consistent legal principles and precedents, the Tribunal allowed the appeal filed by the Appellant, ensuring judicial discipline and providing consequential relief as necessary.