1996 (9) TMI 291 - AT - Central Excise

Summary

Issues: Determination of eligibility for the benefit of Notification No. 175/86-C.E. for the appellants.

Analysis:
1. The appellants were engaged in manufacturing co-extruded polyethylene film for packing milk. Initially exempt under Notification No. 231/82, they later claimed classification under sub-heading 3922.90 and sought the benefit of Notification 132/86. A refund was partially sanctioned, leading to a dispute on classification under sub-heading 3920.31 and eligibility for Notification 175/86.

2. The main argument revolved around whether the appellants, as an SSI unit, were entitled to the benefits of Notification No. 175/86. The appellants lacked an SSI Certificate until June 27, 1986, after the relevant period. However, they contended that their clearances in March 1986, after excluding previous clearances, fell below the threshold of Rs. 7.5 lakhs as per the notification's proviso.

3. The Tribunal found merit in the appellants' argument. The total value of clearances in March 1986 was undisputed, and after deducting the duty paid, it was below Rs. 7.5 lakhs. Citing a precedent, the Tribunal ruled in favor of the appellants, holding them eligible for the benefits under Notification No. 175/86.

4. Another point of contention was the inclusion of duty in the aggregate value of clearances. The Tribunal reiterated that duty paid should be excluded from the cumulative value, as per Section 4(4)(d)(ii) and established legal principles. Despite the inclusion of duty in the total value, the Tribunal held that the duty paid and refunded should be deducted from the cum-duty value for eligibility assessment.

5. Lastly, a claim for exemption of waste was mentioned but not pursued during the hearing. Consequently, the Tribunal did not delve into this issue. The appeal was allowed, setting aside the previous order, with directions for any consequential relief as per the law.