2015 (4) TMI 275 - AT - Central Excise

Denial of SSI exemption - Notification No.8/2003-CE dt. 01/03/2003 - Invocation of extended period of limitation - case of the Revenue is that plastic bottles were not specified for SSI benefit during the period of dispute - Held that - appellant believed bona fide that the subject goods were specified for SSI purpose during the material period. Such belief is said to have been occasioned by the Board s Circular No.71/71/94-CX dt. 27/10/1994 wherein it had been clarified that, so long as the branded castings were supplied to the customer for further manufacture and were not otherwise traded, the benefit of SSI exemption in such cases should not be denied merely on the ground that it was bearing the brand name of another unit. The learned counsel points out that this Circular was withdrawn only on 01/09/2008 vide Circular No.354/124/2008-TRU - good case for the appellant on the ground of limitation as well inasmuch as the circumstances stated by the learned counsel appear to have made them believe that the benefit of Notification No.8/2003-CE as amended was admissible to them in respect of plastic bottles which were cleared under Shalimar brand during the material period. Hence there will be waiver and stay as prayed for. - Stay granted.

Summary

Issues:
1. Waiver and stay against demand of duty of Rs. 56,13,393 for the period from July 2006 to March 2010.
2. Denial of SSI benefit claimed under Notification No.8/2003-CE.
3. Amendment specifying plastic bottles for SSI benefit.
4. Plea of limitation against the demand of duty.
5. Impact of Board's Circular No.71/71/94-CX and Notification No.24/2009-CE(NT) on the case.

Analysis:

1. The appellant sought waiver and stay against a demand of duty amounting to Rs. 56,13,393 for the period from July 2006 to March 2010. The demand was confirmed by the Commissioner based on a show-cause notice invoking the extended period of limitation due to alleged suppression of material facts.

2. The demand arose from the denial of SSI benefit claimed under Notification No.8/2003-CE for plastic bottles cleared under the Shalimar brand name. The Revenue contended that plastic bottles were not specified for SSI benefit during the disputed period but were later specified through an amendment by Notification No.4/2010-CE.

3. The appellant argued that the amendment specifying plastic bottles for SSI benefit was clarificatory and retrospective. Citing a Tribunal's Stay Order in a similar case, the appellant claimed that the SSI benefit should be considered admissible during the disputed period.

4. The appellant raised a plea of limitation against the entire demand, stating that they believed in good faith that the subject goods were specified for SSI purpose during the relevant period. Reference was made to Board's Circular No.71/71/94-CX and Notification No.24/2009-CE(NT) to support their contention.

5. The Tribunal found merit in the appellant's case regarding limitation, considering the circumstances that led them to believe in the admissibility of the SSI benefit under Notification No.8/2003-CE for plastic bottles cleared under the Shalimar brand. Consequently, the Tribunal granted waiver and stay as requested by the appellant.