2000 (9) TMI 355 - AT - Central Excise

Summary

Issues: Availability of benefit of exemption Notification No. 450/86-C.E. dated 17-11-1986 on S.S. hot patti/patta.

In this case, the primary issue revolves around the availability of the benefit of exemption under Notification No. 450/86-C.E. dated 17-11-1986 on S.S. hot patti/patta falling under sub-heading 7220.10 of the Tariff manufactured from S.S. Flats. The appellants claimed this benefit in their classification lists effective from 25-7-1991 and 1-3-1992. However, the Assistant Collector disallowed the benefit, stating that the patti/patta had been manufactured from S.S. flats that were not duty paid, thereby approving the classification lists of the appellants accordingly. The appellants argued that the ingots used for manufacturing S.S. flats, which were then used to make patti/patta, were duty paid, entitling them to the exemption. The Assistant Collector did not accept this argument.

The second issue arises from the confirmation of the Assistant Collector's order by the Collector (Appeals), which the appellants have challenged before the Tribunal. The appellants contended that since the ingots used for manufacturing S.S. flats were duty paid, they should not be denied the benefit of the exemption notification. On the contrary, the JDR argued that S.S. flats, not ingots, were used as inputs for manufacturing patti/patta, and since they were non-duty paid, the benefit of the exemption notification was rightly denied by the Collector (Appeals).

The central issue in this case hinges on the interpretation of Notification No. 450/86-CE dated 17-11-1986, which prescribed a nil rate of duty on patti/patta of stainless steel under certain conditions. The notification required that no credit of duty paid on inputs had been taken under specific rules. The appellants claimed that they had paid duty on the ingots used to manufacture S.S. flats, but they had actually used S.S. flats as inputs for the final product, patti/patta. Since no duty had been paid on the S.S. flats, the appellants did not meet the conditions for claiming the nil rate of duty under the notification. The Tribunal found that the appellants could not legally seek the benefit of the exemption as they did not satisfy the condition of using duty-paid inputs for manufacturing patti/patta. Additionally, an amended notification exempting patti/patta made from ingots or flats with a specified excise duty rate was not applicable in this case due to the timeline of events.

Ultimately, the Tribunal upheld the impugned order of the Collector (Appeals), stating that the appellants' appeal lacked merit and was ordered to be dismissed.