1996 (9) TMI 328 - AT - Central Excise

Summary

Issues: Eligibility of rolls for captive use exemption under different notification numbers.

Analysis:
1. The appeal was filed by M/s. Parasuram Iron & Steel Rolling Mills Pvt. Ltd. against the order-in-original dated 30th September, 1987, passed by the Collector of Central Excise, Pune, regarding the eligibility of rolls for captive use exemption.

2. The appellants were using forged rolls after machining and finishing in their rolling mill for manufacturing iron and steel products. They claimed exemption under Notification No. 118/75-C.E. from 1-8-1982 to 28-2-1986 and under Notification No. 281/86-C.E. from 1-3-1986 to 31-12-1986. The adjudicating authority held that the machined rolls were not eligible for exemption related to captive use.

3. The advocate for the appellant argued that the machined rolls were not complete machinery and thus eligible for exemption under the respective notifications. He referred to a Tribunal decision supporting their claim.

4. The respondent argued that the forged rolls were essential components of machinery and excluded from exemption. They contended that the goods were not eligible for exemption under either notification.

5. The Tribunal considered that the machined rolls were not complete machinery and were used for replacement, thus falling under the exemption criteria of Notification No. 118/75-C.E. The Tribunal cited authoritative decisions to support their interpretation of machinery.

6. The Tribunal concluded that the appellants were eligible for the exemption under Notification No. 118/75-C.E. from 1-1-1982 to 28-2-1986.

7. For the period 1-3-1986 to 31-12-1986, the Tribunal analyzed Notification No. 281/86-C.E., which exempted excisable goods used for repairs or maintenance of machinery. They referred to a previous Tribunal decision supporting the exemption for rolls used for captive consumption.

8. The Tribunal discussed the retrospective effect of the exemption notification under the Central Duties of Excise (Retrospective Exemption) Act, 1986, ensuring the effective rate of duties remained unchanged despite tariff changes.

9. The Tribunal acknowledged that the plea regarding retrospective exemption was not raised earlier but deemed it a legal plea. They found the appellants eligible for exemption under Notification No. 281/86-C.E. from 1-3-1986 to 31-12-1986, considering the scheme of retrospective exemption.

10. Ultimately, the Tribunal vacated the original order and accepted the appeal in favor of the appellants, ruling that they were eligible for exemption under both Notification No. 118/75-C.E. and Notification No. 281/86-C.E. for the respective periods mentioned.