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2016 (3) TMI 710 - AT - Central Excise100% EOU - clearing goods to DTA - Entitlement to benefit of Notification No. 13/98-CE dated 02/06/98 - notice was issued seeking to recover duty - Held that - In order to avail the benefit of notification 13/98-CE it is essential to establish that such goods are otherwise exempt. The respondents had sought to establish that they are entitled to benefit of notification 6/2006-CE. In the instant case the raw material is obtained without payment of duty. The expression such finished products for the condition (a) relates to the product manufactured by the respondent. There is no doubt that the respondents are procuring their primary raw materials, tapes, without payment of any duty. As a result they would not be entitled to the benefit of Notification No.6/2002 as they would not have fulfilled the condition 34 specified in the said notification. Therefore, they would not have been eligible for availing of Notification No. 13/98 as, they failed to establish availability of notification 6/2006-CE. Furthermore the importer had fulfilled the condition of the notification in so much as he had not availed the credit under CENVAT. - Decided in favour of revenue
Issues:
1. Entitlement to benefit of Notification No. 13/98-CE for EOU manufacturing nylon ropes. 2. Interpretation of conditions (a) and (b) of Notification No. 13/98-CE. 3. Applicability of Notification No. 6/2006-CE for claiming exemption. 4. Compliance with conditions for availing exemptions. 5. Comparison with relevant legal precedents. Analysis: Issue 1: Entitlement to benefit of Notification No. 13/98-CE for EOU manufacturing nylon ropes The case involved a respondent, an EOU manufacturing nylon ropes, claiming the benefit of Notification No. 13/98-CE for clearing goods to DTA. The revenue disputed the fulfillment of condition (a) of the notification, leading to a demand notice. The original authority confirmed the demand, but the Commissioner (Appeals) set it aside. The Tribunal reviewed the case to determine the entitlement of the respondent to the notification's benefit. Issue 2: Interpretation of conditions (a) and (b) of Notification No. 13/98-CE Condition (a) of Notification No. 13/98-CE required finished products to be wholly exempt from excise duties or chargeable to Nil rate of duty if not manufactured by a 100% EOU. The Tribunal examined whether the respondent met this condition, especially in comparison to the availability of exemption under Notification No. 6/2006-CE, which was deemed irrelevant by the Commissioner (A). Issue 3: Applicability of Notification No. 6/2006-CE for claiming exemption The respondent argued that their products were exempted under Notification No. 6/2006-CE, emphasizing the condition related to the payment of excise duty on raw materials. However, the Tribunal clarified that to avail the benefit of Notification No. 13/98-CE, it was essential to establish fulfillment of its conditions, irrespective of other exemptions claimed under different notifications. Issue 4: Compliance with conditions for availing exemptions The Tribunal analyzed the procurement of raw materials by the respondent without duty payment, concluding that they failed to establish eligibility for Notification No. 13/98-CE due to non-fulfillment of conditions specified in the relevant notifications. The decision highlighted the importance of meeting specific criteria for claiming exemptions under different notifications. Issue 5: Comparison with relevant legal precedents The Tribunal distinguished the case at hand from previous legal precedents cited by both parties, emphasizing the unique circumstances and applicability of the notifications in question. The decision clarified the differences in cases related to import of goods, levy of duties, and clearance by 100% EOU, underscoring the need for precise interpretation based on the specific facts presented. In conclusion, the Tribunal set aside the impugned order and allowed the appeal of the revenue, emphasizing the importance of meeting the prescribed conditions for availing exemptions under the relevant notifications. The judgment highlighted the necessity of compliance with specific requirements outlined in the notifications to determine the eligibility for concessional rates of duty.
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