Representation from Steel Wire Manufacturers Association - Waiver of duty leviable during 1-8-1980 to 6-4-1981 - Central Excise - 2/91-CX.4

Representation from Steel Wire Manufacturers Association - Waiver of duty leviable during 1-8-1980 to 6-4-1981 Circular No. 2/91-CX.4 Dated 2-1-1991 [From F. No. 138/7/90-CX.4] Government of India Ministry of Finance (Department of Revenue) Central Board of Excise Customs, New Delhi Subject : Representation from Steel Wire Manufacturers Association - Waiver of duty leviable during 1-8-1980 to 6-4-1981 . Reference Board's letter F.No. 267/131/88-CX.8, dated the 19th August, 1988 calling for the practice of assessment in the Collectorates and to say that the Steel Wire Manufacturers Association has been representing for waiver of excise duty that became leviable due to Rule 56A procedure not being followed by wires made from duty paid wire rods during the period 1-8-1980 to 6-4-1981 i.e. after rescinding of Notification No. 75/67-C.E., dated 20-5-1967 and before amendment of Notification No. 206/63 by Notification No. 103/81-C.E., dated 7-4-1981. 2. CEGAT in the case of M/s. Special Steel Limited, Bombay in appeal No. ED/SB/109/83-B1 by Order Nos. 38 and 39/86-B.1, dated 30-1-1986 has held that even prior to the amendment of 7-4-1981 of Notification No. 206/63-C.E. cannot be denied merely on the ground that the wire is made from wire rods a semi-finished steel product, which has not been explicitly included in the list of permissible inputs under Notification No. 206/63-C.E. It, inter alia, held "All steel wires are made from wire rods and all wire rods are made from billets. No wire can be made from blooms, billets, sheet bars listed in (ii) of paragraph 1 of Notification No. 206/63-C.E. But if a billet went into the production of a wire rod and the wire rod then went into drawing wire, we can trace the beginning of that wire to that billet: the wire was made from the billet even though a wire rod appeared midway. One can see no good reason for saying that the wire was not made from that billet. The Collector fell into the error he did mainly because he mistook the semi-finished products as prime determinants of the exemption qualification. We have shown that even when semis are taken to play the role assigned to them by the Collector, the wire can still qualify; but more important than this is that the test was not the semis, but their discharge of the appropriate amount of the duty of excise. The factor to disqualify the wire is use of raw materials semis which have not paid the appropriate amount of duty of excise. The billets from which the wire rods were made are not said to have not paid the appropriate amount of excise duty - there is no complaint about this from the Department. Therefore, the wires qualify fully having been made from semi-finished steel on which the appropriate amount of duty of excise has been paid". 3. The Board has already accepted the decision of the CEGAT in this case and no appeal has been filed in the Supreme Court. 4. In view of the above decision of the CEGAT, if the benefit of Notification No. 206/63-C.E., dated 30-11-1963 as amended is extended, there would be no need to invoke the provisions of Section 11C to waive payment of duty leviable during the period 1-8-1980 to 6-4-1981. Accordingly, the Board directs that all pending proceedings in similar cases may be disposed of in accordance with the ratio laid down by the CEGAT in the case of M/s. Special Steel Limited, Bombay - Order No. 38 and 39/86-B1, dated 30th January, 1986. 5. Field formations and Trade may be informed suitably.