2017 (6) TMI 612 - AT - Customs

CVD exemption - import of 100% polyester blanket - N/N. 30/2004-CE dated 9.7.2004 - denial of exemption on the ground that the credit availed on inputs - Held that - reliance placed in the appellant own case Monte Carlo Fashions Ltd. Versus Commissioner of Customs, Amritsar 2017 (2) TMI 526 - CESTAT CHANDIGARH , where it was held that the decision of Hon ble Madras High Court in the case of HLG Trading 2015 (11) TMI 313 - MADRAS HIGH COURT was under the challenge of vires of N/N. 34/2015-C.E., dated 17-7-2015 and N/N. 37/2015-C.E., dated 21-7-2015 which substituted the proviso condition relating to eligibility of exemption for Central Excise duty. The proviso afer Para 1 of exemption N/N. 30/2004-C.E. was substituted on 17-7-2015 vide N/N. 34/2015. Such substitution changed the scope of the condition and is subsequent to the decisions of Hon ble Supreme Court - unamended proviso of the notifications are applicable - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Eligibility for CVD exemption under Notification No.30/2004-CE.
2. Interpretation of conditions for availing exemption.
3. Comparison with relevant Supreme Court judgments.
4. Reference to the decision of the Hon'ble Madras High Court.
5. Applicability of the exemption in the appellant's case.

Analysis:

1. The appellants contested the imposition of Countervailing Duty (CVD) on imported 100% polyester blankets under the Central Excise Tariff Act, 1975. The dispute centered on their eligibility for CVD exemption as per Notification No.30/2004-CE dated 9.7.2004. The Revenue argued that the appellants did not fulfill the condition for exemption, which requires that duty paid on inputs should not have been availed under the Cenvat Credit Rules, 2004.

2. The appellant's counsel relied on Supreme Court judgments in SRF Ltd. and AIDEK Tourism Services Pvt. Ltd. to support their claim for exemption. They also highlighted a previous Tribunal decision in their favor regarding a similar import of goods. The argument was based on the interpretation of the exemption conditions and the applicability of the CVD exemption in their case.

3. The Tribunal referred to its own previous decision in the appellant's case regarding a similar import, where it was observed that the exemption under Notification No.30/2004-CE is applicable if the credit of duty on inputs has not been availed. The Tribunal also cited the Supreme Court's interpretation of section 3(1) of the Central Excise Tariff Act, emphasizing the quantification of additional duty for imported goods.

4. The Tribunal considered the decision of the Hon'ble Madras High Court in the case of HLG Trading vs. Union of India, which dealt with the challenge to the substitution of the proviso condition in Notification No.30/2004-CE. The High Court's dismissal of the challenge against the substitution indicated a change in the scope of the exemption condition, post the Supreme Court judgments referred to by the appellant.

5. Ultimately, based on the Tribunal's previous decision in the appellant's case and the interpretation of relevant legal provisions and judgments, the impugned orders of the Commissioner (Appeals) were set aside, and the appeals were allowed with consequential relief, if any. The Tribunal's decision was in favor of the appellants, granting them relief from the CVD imposition on the imported goods.