2018 (7) TMI 978 - AT - Central Excise

100% EOU - clearances of by-products by availing benefit of N/N. 23/2003-CE dated 31.03.2003 - The case of the department is that the appellant did not obtain any permission from the Development Commissioner for the said clearances - appellant claims that they are holding two star export house status and not required to obtain permission for removal of goods in DTA. Held that - The Ld. Commissioner has recorded that the appellant have not produced any evidence that they are holding two star export house status therefore the matter needs re-consideration on this issue. However the appellant have submitted the certificate of two star export house status with the present appeal. Since there is no finding on this issue whether the appellant is eligible to clear the goods without obtaining any permission of the Development Commissioner. Therefore the impugned order set aside and matter remanded to the adjudicating authority to re-consider the issue of two star export house status with reference to the para 6.39.13 of the Handbook of Procedure - The appellant s submission is also that the spent solvent is not excisable goods therefore the permission is not required and no duty can be demanded. This issue also needs to be reconsidered by the adjudicating authority. Appeal allowed by way of remand.

Summary

Issues:
1. Clearance of by-products without permission from Development Commissioner.
2. Applicability of para 6.39.13 of Handbook of Procedure for clearance of goods.
3. Two star export house status and requirement of permission for removal of goods in DTA.
4. Submission of evidence regarding two star export house status.
5. Classification of spent solvent as excisable goods.

Analysis:

1. The appellant, a 100% EOU, cleared by-products at concessional rates without obtaining permission from the Development Commissioner, leading to a demand of central excise duty. The Ld. Commissioner (Appeals) rejected their appeal, prompting the present appeal.

2. The appellant argued that as a two star export house, they are not required to obtain permission for clearance as per para 6.39.13 of the Handbook of Procedure. Citing various judgments, the appellant contended that the demand does not hold. The Revenue countered, stating that the said para only permits clearance of finished goods, not by-products, and the appellant failed to provide intimation to the department.

3. The Ld. Commissioner found no evidence of the appellant's two star export house status, necessitating a re-examination. The appellant later submitted the certificate with the appeal. The Tribunal remanded the matter to the adjudicating authority to determine the eligibility of the appellant to clear goods without permission and to reconsider the status with reference to para 6.39.13.

4. Additionally, the appellant claimed that spent solvent is not excisable goods, hence no duty can be demanded. This argument also requires reconsideration by the adjudicating authority.

5. In conclusion, the Tribunal allowed the appeal by remanding the matter for further examination regarding the two star export house status, applicability of para 6.39.13, and the classification of spent solvent. The impugned order was set aside for a fresh determination by the adjudicating authority.