1999 (10) TMI 502 - AT - Central Excise

Summary

Issues:
1. Whether the value of HDPE woven fabrics should be included in the computation of the duty-free clearance limit under Notification No. 1/93.
2. Applicability of exemptions under Notification No. 214/86 for job work.

Analysis:
1. The case involved a dispute regarding the inclusion of the value of HDPE woven fabrics in the duty-free clearance limit of Rs. 30 Lakhs under Notification No. 1/93. The Commissioner (A) had held that the value of the fabrics should be included in the clearance limit, leading to a demand for duty. The appellants contended that the fabrics were sent for job work and received back for further processing, thus not requiring duty payment. The Addl. Commissioner upheld the duty demand, which was further confirmed by the Commissioner (A). However, the Tribunal, after considering the submissions, invoked Explanation II of Notification No. 1/93, stating that if goods were exempted under Notification No. 214/86, their value need not be added for computing the clearance limit. Consequently, the Tribunal allowed the appeal, setting aside the duty demand.

2. The second issue revolved around the applicability of exemptions under Notification No. 214/86 for job work. The Tribunal noted that the goods in question were sent for job work and received back, meeting the conditions of the notification. The notification required an undertaking and evidence of use in final products, which were fulfilled in this case. The Tribunal found that since the goods were exempted under Notification No. 214/86, the value of the HDPE fabrics did not need to be included in the calculation of the clearance limit under Notification No. 1/93. Therefore, the Tribunal allowed the appeal based on the provisions of the notifications and granted consequential relief as per the law.

In conclusion, the Tribunal's judgment clarified the application of the notifications regarding duty-free clearance limits and exemptions for job work, ultimately ruling in favor of the appellants by allowing the appeal and setting aside the duty demand.