2007 (12) TMI 192 - AT - Central Excise

SSI unit - whether the value of inputs (plastic film, plastic laminated film) manufactured & captively consumed in the mfg. of final goods (plastic pouches) was to be excluded from the aggregate clearance value as per SSI Notification No. 8/98, the aggregate value of clearances of all the specified goods should be taken for the entire period not for segments of period only after correct computation, one has to see as to whether the limit was exceeded or not case remanded

Summary

Issues:
1. Interpretation of SSI exemption notifications for specified goods.
2. Computation of aggregate value of clearances under the SSI scheme.
3. Consideration of different categories of specified goods for duty calculation.
4. Application of case law in similar SSI exemption cases.
5. Remand for correct computation of aggregate value of clearances.

Analysis:

Issue 1: Interpretation of SSI exemption notifications for specified goods
The appeals involved the interpretation of SSI exemption notifications for specified goods like plastic film, plastic laminated film, and plastic pouches. The appellant availed exemptions under Notification No. 8/98-C.E. for plastic film and plastic laminated film and under Notification No. 5/98-C.E. for plastic pouches. The dispute arose regarding the duty demands raised by the original authority based on the value of clearances of different goods.

Issue 2: Computation of aggregate value of clearances under the SSI scheme
The Tribunal noted that the SSI scheme operated fiscal year-wise, and the aggregate value of clearances of all specified goods should have been considered for the entire period. The authorities below had computed the values for segments of the financial year instead of the entire period, leading to incorrect demands of duty. The correct computation of the aggregate value of clearances was crucial to determine if the prescribed limit in the SSI Notification was exceeded.

Issue 3: Consideration of different categories of specified goods for duty calculation
The Tribunal emphasized that if the limit prescribed in the SSI Notification was exceeded, there would be a demand of duty on all specified goods. The lower authorities had overlooked this scheme by not considering all specified goods collectively for duty calculation. The Tribunal directed a remand to enable the original authority to pass a composite order covering the entire period after the correct computation of the aggregate value of clearances.

Issue 4: Application of case law in similar SSI exemption cases
The appellant's counsel relied on relevant case law, including a Tribunal decision and an apex court judgment, to support their arguments. The Tribunal acknowledged the importance of considering cited case law in interpreting SSI notifications and determining the exclusion or inclusion of values for duty calculation.

Issue 5: Remand for correct computation of aggregate value of clearances
In conclusion, the Tribunal allowed all three appeals by setting aside or modifying the orders of the appellate Commissioner. The Tribunal directed a remand to ensure the correct computation of the aggregate value of clearances for all specified goods for the entire period under consideration. The appellant was to be given a reasonable opportunity to present their case during the remand process.