2008 (10) TMI 90 - AT - Central Excise

Manufacture of uncoated kraft paper - certain cuttings and trimmings arising during mfg. were used captively - benefit of Notification No. 10/96 claimed at later stage but not at time of filing declaration - held that even if an applicant does not claim benefit under a particular notification at initial stage, he is not debarred from claiming such benefit at later stage - however exemption is subjected to fulfillment of conditions specified in notification ibid - matter remanded

Summary

Issues:
1. Claim of exemption under Notification No. 10/96.
2. Requirement of claiming exemption at the initial stage.
3. Benefit of notification claimed at a later stage.
4. Verification of conditions specified in the notification.

Analysis:
1. The case involved the issue of the respondents claiming exemption under Notification No. 10/96 for the clearance of certain cuttings and trimmings used in the manufacture of kraft paper. The Commissioner (Appeals) allowed the benefit of the notification, which was contested by the Revenue in the appeal, arguing that the exemption should have been claimed at the time of filing the declaration.

2. The Revenue contended that the benefit of Notification No. 10/96 was conditional, requiring the assessee to declare their intention to avail the exemption before removal of the goods. Reference was made to legal precedents emphasizing the importance of claiming exemption at the initial stage to enable verification of compliance with specified conditions.

3. The respondents argued that they were entitled to the benefit of Notification No. 67/95 and, alternatively, under Notification No. 10/96 as clarified by a Board circular. They relied on decisions stating that benefits not claimed initially can still be availed at the appellate stage, citing legal precedents and a Supreme Court decision supporting their position.

4. The Tribunal noted that the Revenue did not dispute the availability of the benefit under Notification No. 10/96 on merits but raised objections regarding the timing of the claim. Citing a recent Supreme Court decision, the Tribunal held that claimants are not barred from seeking benefits at a later stage. However, it emphasized the importance of verifying specified conditions, which should be determined by the adjudicating authority based on evidence and records. As there was no finding on compliance with conditions, the matter was remanded for further consideration.

This detailed analysis covers the key issues raised in the legal judgment, highlighting the arguments presented by both parties and the Tribunal's decision regarding the claim of exemption under Notification No. 10/96 and the requirement for verification of specified conditions before extending the benefit.