2000 (10) TMI 121 - AT - Central Excise

Summary

Issues:
1. Entitlement of rubberised coir mattresses and cushions for the benefit of Notification No. 115/75-C.E.

Analysis:
The appellants contested the order-in-original passed by the Commissioner of Central Excise, which confirmed a demand and imposed penalties. The appellants claimed entitlement to the benefit of Notification No. 115/75-C.E., which exempts goods manufactured by the Coir Industry from Central Excise duty. The appellants argued that rubberised coir mattresses containing 55% coir are eligible for the exemption based on a CBEC circular clarifying the matter. They also emphasized that the test report confirmed the coir content in the goods. The appellants challenged the Commissioner's reliance on an opinion by a Chemical Engineer who had not visited their factory or seen the samples. Additionally, they cited precedents such as the Supreme Court's decision in Bombay Oil Industries Ltd. v. CCE to support their claim.

The revenue authorities, on the other hand, argued that the goods in question did not qualify as products of the Coir Industry based on definitions from industrial directories. They also highlighted the appellants' registration under the Rubber Act, suggesting their products were related to the rubber industry. The revenue authorities questioned the reliance on the test report due to the timing of sample collection and raised doubts about a potential change in the manufacturing process. They cited legal precedents to emphasize that the burden of proving entitlement to exemption lies with the appellants.

The key issue revolved around the interpretation of Notification No. 115/75-C.E. and whether the rubberised coir mattresses and cushions manufactured by the appellants qualified for the exemption under this notification. The Tribunal analyzed the wording of the notification, the CBEC circular clarifying the eligibility criteria, and the test report confirming the coir content in the goods. The Tribunal found that the appellants met the conditions specified in the notification and were entitled to the exemption. Relying on legal precedents and the test report, the Tribunal set aside the impugned order and allowed the appeals in favor of the appellants.