2019 (6) TMI 4 - AT - Central Excise

SSI exemption - allegation of the Department is that since the appellant has cleared the goods on payment of duty for a short period they cannot thereafter avail SSI exemption for the remaining part of the financial year - no intimation given to the Department regarding intention to avail SSI Exemption - HELD THAT - On perusal of paragraph 2(i) of the Notification however it is seen that when a manufacturer intends not to avail exemption contained in this Notification and instead pay the normal rate of duty on the goods cleared by him such option shall not be withdrawn during the remaining part of the financial year - In the present case the appellant has not furnished any intimation to the Department showing that they have no intention to avail the option of SSI exemption benefit. The Larger Bench of the Tribunal in the case of ANKIT PACKAGING LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE HYDERABAD 2003 (12) TMI 86 - CESTAT NEW DELHI has considered the very same issue and has held that even though a few clearances were made by the manufacturer on payment of Excise Duty it cannot be considered as de facto opting out of the exemption of the Notification. Appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Applicability of SSI exemption for clearances made by the appellant.
2. Requirement of intimation to the Department for availing the SSI exemption benefit.
3. Interpretation of Notification No. 08/2003-CE dated 01.03.2003.
4. Consideration of case laws and tribunal decisions in similar matters.

Analysis:
1. The case involved the question of whether the appellant, engaged in the manufacture of 'Concrete Block,' was eligible to avail the benefit of SSI exemption for clearances made during the financial year 2010-2011.

2. The Department contended that the appellant was liable to pay duty for clearances made from 01.07.2010 to 31.03.2011, as they had paid duty for a short period and did not inform the Department about their intent to avail the SSI exemption.

3. The appellant argued that the initial duty payments did not preclude them from later claiming the SSI exemption, citing Notification No. 08/2003-CE dated 01.03.2003, which did not mandate informing the Department to avail the exemption.

4. The Tribunal examined the Notification and relevant case laws, including M/s. Ankit Packaging Ltd. and M/s. Shree Cables and Conductors (P) Ltd., to determine that paying duty for a brief period did not automatically disqualify the appellant from subsequently claiming the SSI exemption.

5. Ultimately, the Tribunal held that the appellant was entitled to avail the SSI exemption for the remaining part of the financial year, as the duty payments made initially did not amount to opting out of the exemption. The impugned order demanding duty, interest, and penalties was set aside, and the appeal was allowed with consequential reliefs as per law.