2009 (1) TMI 152 - AT - Central Excise

Captive consumption - whether Partially Oriented Yarn (POY) used within the factory for further manufacture is exempt from the payment of National Calamity Contingent Duty (NCCD) by virtue of Notification No. 67/95 dt. 16-3-1995 - In the absence of inclusion of NCCD under Notification No. 67/95 and in view of the similarity between Section 136 Finance Act, 2001 and Section 3(3) of Additional Duties of Excise (Goods of Special Importance) Act, 1957, POY used captively is not exempt from NCCD assessee appeal rejected

Summary

The Appellate Tribunal CESTAT AHMEDABAD, in the 2009 judgment 2009 (1) TMI 152 - CESTAT AHMEDABAD, addressed the issue of whether Partially Oriented Yarn (POY) used within a factory for further manufacture is exempt from the payment of National Calamity Contingent Duty (NCCD) under Notification No. 67/95 dt. 16-3-199. The appellant argued that NCCD is a duty of excise and, according to Circular No. 641/32/2002-CX, no NCCD is leviable on goods exported under bond. The appellant also referenced Section 136 of the Finance Act to support their contention that NCCD is essentially excise duty. The Suriyanarayanan, the advocate, argued that the appellants were eligible for NCCD exemption for captive consumption. The Tribunal found that the provisions of Section 136(3) and Section 3(3) of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 were similar. Since Notification No. 67/95-C.E. specifically provided an exemption for AED (GSI) when used within the factory, and NCCD was not included in this notification, the Commissioner (Appeals)'s decision was upheld. The Commissioner (Appeals) had already taken a lenient view on penalties, reducing it from Rs. 3 lakhs to Rs. 1 lakh. Given the interpretations presented and the lack of intent to evade duty, the Tribunal decided that no penalty was warranted and, thus, set it aside. The appeal was otherwise rejected, with the decision announced on 7-1-2009.