1995 (12) TMI 142 - AT - Central Excise

Summary

Issues:
Admissibility of exemption in case of Steam under Notification No. 118/75 produced and supplied by one company to another in the same compound.

Analysis:
In the case of Appeal No. E/3053/86-C, the Revenue argued that the company did not follow the necessary procedures under Chapter X and that the factory receiving the steam did not meet the definition of a factory under the Central Excise Act. The Revenue contended that the company should not be granted exemption due to these reasons. The Revenue also highlighted that the Assistant Collector had the authority to review orders and that classification lists can be changed prospectively. The Revenue cited a previous case to support their argument.

On the other hand, the respondents argued that the factory receiving the steam did qualify as a factory under the Central Excise Act as it was producing excisable goods and was duly licensed by the authorities. The respondents emphasized that the Circular issued by the Central Board of Excise and Customs supported their position. They argued that the grounds mentioned in the Show Cause Notice should be the basis for the decision and that the factory met the definition of a factory as per the Act.

The Tribunal considered the arguments presented by both sides and found that the factory receiving the steam did indeed qualify as a factory under the Central Excise Act as it was producing excisable goods. The Tribunal also noted that the grounds for denying exemption, as mentioned in the Show Cause Notice, had been met by the company. Therefore, the Tribunal rejected the Revenue's appeal and upheld the order in favor of the company. In the case of Appeal No. E/798/89-C, the Tribunal set aside the impugned order based on similar reasoning as in the previous case.