2005 (5) TMI 170 - AT - Central Excise

Summary

Issues involved: Interpretation of conditions under Notification No. 14/2002-C.E. for availing lower rate of duty for a composite mill manufacturing fabrics.

In this judgment by the Appellate Tribunal CESTAT, Mumbai, the issue at hand was whether a composite mill manufacturing fabrics could avail of a lower rate of duty under Notification No. 14/2002-C.E. The Tribunal dispensed with the requirement of pre-deposit and proceeded to decide the main appeal, focusing on the interpretation of conditions under the Notification which necessitate payment of appropriate Excise duty on raw materials.

The Tribunal had previously considered a similar issue in a case involving The Simplex Mills Co. Ltd. and concluded that fabrics manufactured by a composite textiles mill from textile fiber purchased from the market are eligible for exemption under Notification No. 14/2002-C.E. as the fibers are deemed to be duty paid. This decision was made in light of a clarification issued under C.B.E. & C. Circular No. 680/71/2002-CX and the explanation to the said notification.

Furthermore, the Tribunal observed that other textile mills in similar situations had been granted duty concessions by other Commissioners. Therefore, based on the decision reached in the case of The Simplex Mills Co. Ltd., the Tribunal set aside the impugned order passed by the lower appellate authority and allowed the appeal with consequential benefit.

Ultimately, the appeal and the stay petition were disposed of in accordance with the above terms, and the operative part of the order was pronounced in court on the date of the hearing.