2015 (10) TMI 1148 - AT - Central Excise

Waiver of pre deposit - SSI exemption - Held that - Appellant is eligible for SSI exemption for CNSL falling under Chapter Heading No.13021920. On a perusal of the TRU letter no.334/3/2006, dated 01.03.2006 (unsigned website copy), the Board has issued clarification on budgetary changes - The amended S.No.(iii) of the annexure to the Notification No.8/2003 clearly covers Chapter 9 to 20. Since appellant is covered under Chapter 13 and goods falling under Chapter 9 to 20 are eligible for SSI exemption under Heading No. 0902. Hence, the appellant prima facie , has made a case for waiver of pre-deposit of duty, interest and penalty. Accordingly, the pre-deposit the entire amount duty, interest and penalty is waived and stay recovery thereof till disposal of the appeal. - Stay granted.

Issues:
1. Eligibility for SSI exemption under Notification No.8/2003.
2. Denial of exemption and confirmation of duty under Notification No.16/2012.
3. Interpretation of the TRU letter no.334/3/2006 for clarification on budgetary changes.

Analysis:

1. Eligibility for SSI exemption under Notification No.8/2003:
The appellant, engaged in the manufacture of Cashew Shell Liquid (CNSL), claimed eligibility for the Small Scale Industries (SSI) exemption under Notification No.8/2003. The appellant argued that they fell under Chapter Heading No.13021920 and were covered by the SSI exemption. The consultant for the appellant highlighted that the corrigendum to the notification, which included Chapter 9 to 20, was not considered during adjudication. The Tribunal found that the appellant was indeed eligible for the SSI exemption as per the amended annexure to Notification No.8/2003, which covered goods falling under Chapter 9 to 20. Therefore, the appellant's claim for SSI exemption was upheld.

2. Denial of exemption and confirmation of duty under Notification No.16/2012:
The Adjudicating authority had denied the SSI exemption to the appellant and confirmed the duty liability under Notification No.16/2012. The Revenue, represented by the Authorised Representative, supported the decision of the authorities below. However, the Tribunal disagreed with the Revenue's stance and held that the appellant was rightly eligible for the SSI exemption. The Tribunal noted that the correction in the annexure to Notification No.8/2003 clearly included goods falling under Chapter 9 to 20, which covered the appellant's product falling under Chapter Heading No.13021920. Consequently, the duty under Notification No.16/2012 was not applicable to the appellant.

3. Interpretation of the TRU letter no.334/3/2006 for clarification on budgetary changes:
The Tribunal referred to the TRU letter no.334/3/2006, dated 01.03.2006, which provided clarification on budgetary changes. The letter highlighted an amendment that specified Chapter 9 to 20 under the SSI exemption Notification No.8/2003. By analyzing this clarification, the Tribunal concluded that the appellant, falling under Chapter 13 and covered by Chapter 9 to 20, was prima facie eligible for waiver of pre-deposit of duty, interest, and penalty. Consequently, the Tribunal waived the pre-deposit and stayed the recovery of the entire amount until the appeal's disposal.

In conclusion, the Appellate Tribunal CESTAT CHENNAI ruled in favor of the appellant, upholding their eligibility for the SSI exemption under Notification No.8/2003 and setting aside the duty liability confirmed under Notification No.16/2012 based on the interpretation of relevant notifications and clarifications provided.

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