2002 (5) TMI 151 - AT - Central Excise

Summary

Issues:
1. Whether the benefit of exemption under Notification No. 223/88-C.E. is available to the excisable goods manufactured by M/s. Neco Castings Ltd.

Analysis:
The appeal filed by M/s. Neco Castings Ltd. raised the issue of whether they were eligible for the exemption under Notification No. 223/88-C.E. The dispute arose when a show cause notice was issued to them for disallowing the benefit of the notification, alleging that certain processes beyond those permitted had been carried out in the manufacturing of the goods. The Assistant Commissioner initially dropped the proceedings, but on appeal by the Revenue, the Commissioner (Appeals) ruled against M/s. Neco Castings Ltd., citing Board's Circular No. 225/59/96-CX. The Appellants argued that they had only undertaken processes permitted by the notification, such as grinding, heat treatment, and shot blasting, and that their products met the criteria specified. They relied on previous decisions and maintained that the items still qualified as castings eligible for the exemption.

The Advocate for M/s. Neco Castings Ltd. emphasized that the processes they undertook were within the scope of the notification, including heat treatment, shot blasting, and grinding to meet customer specifications. The Tribunal found merit in the argument that there was no evidence presented by the Revenue to prove that processes beyond those allowed by the notification were carried out by the Appellants. The Tribunal referenced a previous case to support the contention that goods obtained through casting processes should be eligible for the exemption unless additional processes not specified in the notification were undertaken. The Tribunal concluded that since there was no evidence of unauthorized processes being carried out by M/s. Neco Castings Ltd., they were entitled to the benefit of the exemption under Notification No. 223/88-C.E. The Tribunal distinguished this case from a previous case where grinding was done to maintain dimensions, which was deemed impermissible for claiming the concessional rate of duty under the notification.

In summary, the Tribunal ruled in favor of M/s. Neco Castings Ltd., allowing their appeal and setting aside the decision that denied them the benefit of the exemption under Notification No. 223/88-C.E.