2015 (10) TMI 1955 - AT - Central Excise

SSI Exemption - benefit of small scale Notification 08/02-EX, dated 1-3-2002 - Concessional rate of duty - Clearance of exempted goods - Held that - Revenue has placed on record report from the Deputy Commissioner clarifying that the total value of the branded goods during the period 2001-2002 was to the tune of ₹ 84,56,451/-, relatable to Tariff Heading 5509, though as per the appellant the total clearances of the branded goods, including clearances under Chapter Heading 5509 would be to the tune of ₹ 1.40 crores. Without going into the said factual aspect, we find that even if the branded goods clearances to the tune of ₹ 84,56,451/-, as reported by the Revenue, are taken into account, the total clearances of the previous year would not exceed ₹ 3 lakhs. If that be so, the appellant have complied with the eligibility criteria for availment of the notification during the subsequent financial year and would be entitled to the benefit of the same. Accordingly, we set aside the impugned order - Decided in favour of assessee.

Summary

Issues:
Interpretation of small scale Notification 08/02-EX for availing exemption benefits based on the total clearance value in the preceding financial year.

Analysis:
The appellant started availing the benefit of small scale Notification 08/02-EX during the financial year 2002-2003. They cleared Cenvatable goods valued at approximately &8377; 99 lakhs from 1-4-2002 to 30-6-2002, claiming full exemption. Subsequently, they began paying concessional duty rates and cleared goods after availing Cenvat credit as per the notification's terms.

One condition of the small scale notification was that the total clearance in the preceding financial year should not exceed &8377; 3 crores. The revenue contended that the appellant's clearances in the previous financial year 2001-2002 were over &8377; 3 crores (specifically &8377; 3.82 crores), making them ineligible for exemption in the subsequent financial year 2002-2003. This led to proceedings against the appellant and the issuance of the impugned order.

The appellant argued that the total clearance of &8377; 3.82 crores included clearances of branded goods, which were fully duty-paid. They asserted that the value of these branded goods should be deducted when calculating the total clearance value of the previous year. The Tribunal directed the Revenue to verify this claim.

The Deputy Commissioner's report clarified that the total value of branded goods in 2001-2002 was &8377; 84,56,451, related to Tariff Heading 5509. The appellant contended that the total clearances of branded goods, including those under Chapter Heading 5509, amounted to &8377; 1.40 crores. Even considering the reported value of branded goods, the total clearances of the previous year did not exceed &8377; 3 lakhs. Therefore, the appellant met the eligibility criteria for the notification in the subsequent financial year and was entitled to the exemption benefit. Consequently, the impugned order was set aside, and the appeal was allowed in favor of the appellant.