2015 (10) TMI 1120 - AT - Central Excise

Interpretation of Notification No. 43/2001 dated 26.6.2001 - whether notification has to be interpreted to mean that export has to be made by the appellant only or the goods are to be exported - Held that - The spirit of the notification being to export the goods manufactured using duty free raw material irrespective of the person who exported the same there should not be controversy to bring the appellant to the jaws of the levy. Added to this, the appellant was granted permission for clearing the duty free raw material for use in export of the finished goods supported by proof of export, appellant succeeds - Decided in favour of assessee.

Summary

Issues: Interpretation of notification regarding duty-free raw materials for export; Allegation of non-export by appellant; Levy of penalty by Department

Interpretation of Notification Regarding Duty-Free Raw Materials for Export:
The judgment revolves around the interpretation of a notification concerning duty-free raw materials for export. The appellant procured raw materials domestically duty-free and was permitted by the excise authority to clear them for further processing by an exporter. The condition was to fulfill stipulated requirements and provide proof of export. The appellant satisfied these conditions by submitting proof of export, leading to a dispute on whether the notification required the appellant itself to export the goods or if the goods needed to be exported. The Tribunal held that the spirit of the notification aimed at exporting goods manufactured using duty-free raw materials, regardless of the exporter. As the appellant fulfilled the conditions and provided proof of export, the Tribunal ruled in favor of the appellant, allowing the appeal.

Allegation of Non-Export by Appellant:
The Revenue alleged that the appellant did not export the goods themselves, leading to a controversy on the interpretation of the notification. The crux of the issue was whether the export had to be done by the appellant or if it was sufficient for the goods to be exported. The Tribunal emphasized that the notification aimed at exporting goods manufactured using duty-free raw materials, and as long as the finished goods were exported with proof, it was not necessary for the appellant to be the exporter. Consequently, the Tribunal found in favor of the appellant, dismissing the Revenue's allegation and allowing the appeal.

Levy of Penalty by Department:
Following the decision in favor of the appellant regarding the interpretation of the notification and the export requirements, the Tribunal dismissed the Department's appeal and waived the levy of penalty. The Tribunal's ruling was based on the appellant fulfilling the conditions of the notification and providing evidence of export, thereby absolving them from the penalty imposed by the Department. The judgment concluded with the Department's appeal being dismissed, aligning with the Tribunal's decision in favor of the appellant.