Modvat - Deemed Credit for yarn and fibres of Chapters 51 to 56 - Notification No. 11/96-C.E. (N.T.) - Superseded - 29/96 - Central Excise - Non Tariff

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Modvat - Deemed Credit for yarn and fibres of Chapters 51 to 56 - Notification No. 11/96-C.E. (N.T.) - Superseded

Notification No. 29/96-C.E. (N.T.)

Dated 3-9-1996

In exercise of the powers conferred by sub-rule (2) of rule 57A of the Central Excise Rules, 1944 and in supersession of the notification of Government of India in the Ministry of Finance (Department of Revenue) No. 11/96-Central Excises (N.T.), dated the 23rd of July, 1996, the Central Government, hereby declares the following inputs and the final products falling within the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), namely :-

Sl. No.	Inputs	Final Products
(1)	(2)	(3)
1.	(i) goods falling within heading No. 51.05 of the said Schedule (ii) goods falling within heading No. 55.01, 55.02, 55.03, 55.04, 55.05, 55.06 or 55.07 of the said Schedule (iii) goods falling within heading No. 51.06, 51.07, 52.05, 52.06, 53.06, 53.07, 53.08, 54.02, 54.03, 54.04, 54.05, 55.09, 55.10, 56.04, 56.05 or 56.06 of the said Schedule	The following goods manufactured by a composite mill, namely :- (i) Processed fabrics falling within Cha-pter 52 (except sub-heading Nos. 5207.10, 5208.10 and 5209.10) or Cha-pter 54 (except sub-heading Nos. 5406.10 and 5407.10) or Chapter 55 (except sub-heading Nos. 5511.10, 5512.10, 5513.10 and 5514.10), or fabrics of cotton or man made fibres, whether or not processed, falling within hea-ding No. 58.06 (except sub-heading No. 5806.20), 60.01 or 60.02 (except sub-heading No. 6002.10) of the said Schedule
2.	(i) goods falling within heading No. 51.05 of the said Schedule(ii) goods falling within heading No.55.01, 55.02, 55.03, 55.04, 55.05, 55.06 or 55.07 of the said Schedule(iii) goods falling within heading No. 51.06, 51.07, 52.05, 52.06, 53.06, 53.07, 53.08, 54.02, 54.03, 54.04, 54.05, 55.09, 55.10, 56.04, 56.05 or 56.06 of the said Schedule(iv) Dyes, chemicals, consumables, packaging materials falling within the said Schedule	The following goods manufactured by a manufacturer other than a composite mill, namely :-(i) Processed fabrics falling within Chapter 52 (except sub-heading Nos. 5207.10, 5208.10 and 5209.10) or Chapter 54 (except sub-heading Nos. 5406.10 and 5407.10) or Chapter 55 (except sub-heading Nos. 5511.10, 5512.10, 5513.10 and 5514.10), or fabrics of cotton or man-made fibres, whether or not processed, falling within hea-ding No. 58.06 (except sub-heading No. 5806.20), 60.01 or 60.02 (except sub-heading No. 6002.10) of the said Schedule.

2. The Central Government further declares that -

(i) the duty of excise under the Central Excises and Salt Act, 1944 (1 of 1944);

(ii) the additional duty under section 3 of the Customs Tariff Act, 1975 (51 of 1975); or

(iii) the additional duty of excise under section 3 of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978 (40 of 1978),

(hereinafter referred to as declared duty) shall be deemed to have been paid on the inputs declared herein and the same.

(I) in case of a composite mill, shall be equivalent to the amount calculated at the rate of -

(a) 40 per cent of the duty of excise leviable under the Central Excises and Salt Act, 1944 (1 of 1944), read with any notification for the time being in force, on the final products of cotton (not containing any other textile material) declared herein.

(b) 60 per cent of the duty excise leviable under the Central Excises and Salt Act, 1944 (1 of 1944), read with any notification for the time being in force, on the final products other than of cotton (not containing any other textile material) declared herein,

(II) in case of a manufacturer other than a composite mill, shall be equivalent to the amount calculated at the rate of -

(a) 50 per cent of the duty of excise leviable under the Central Excises and Salt Act, 1944 (1 of 1944), read with any notification for the time being in force, on the final products of cotton (not containing any other textile material) declared herein,

(b) 70 per cent of the duty of excise leviable under the Central Excises and Salt Act, 1944 (1 of 1944), read with any notification for the time being in force, on the final products other than of cotton (not containing any other textile material) declared herein,

and credit of the declared duty so deemed to have been paid shall be allowed to the manufacturer of the final products, without production of documents evidencing payment of duty on the said inputs, at the time of clearance of the said final products.

3. The credit of declared duty allowed in respect of the said inputs shall be utilised only towards payment of duty of excise leviable under the said Central Excises and Salt Act on the said final products:

Provided that the credit of declared duty in respect of inputs used in the final products cleared for export under bond shall be allowed to be utilised towards payment of duty of excise on any final products cleared for home consumption or for export on payment of duty and, where for any reason, such adjustment is not possible, by refund to the manufacturer subject to such safeguards, conditions and limitations as may be specified by the Central Government in the Official Gazette:

Provided further that no such refund of credit of declared duty shall be allowed if the manufacturer avails of drawback allowed under the Customs and Central Excise Duties (Drawback) Rules, 1971, or claims rebate of duty under rule 12, in respect of such duty.

4. The provisions of this notification shall not apply to a manufacturer (other than composite mill) who avails any credit in respect of inputs (other than processed fabrics when received as an input) under any notification issued under sub-rule (1) of rule 57A of the said Rules of 1944.

5. In respect of a composite mill, the provisions of this notification shall apply only to-

(i) unprocessed fabrics not woven in the same composite mill and lying in stock as on 4th day of September, 1996;

(ii) processed fabrics manufactured from unprocessed fabrics not woven in the same composite mill and lying in stock as on 4th day of September, 1996;

(iii) processed fabrics manufactured from unprocessed fabrics not woven in the same composite mill.

6. Where the final products have been removed clandestinely without payment of duty of excise leviable under the Central Excises and Salt Act, 1944 or as the case may be, the additional duty leviable under the Additional Duties of Excise (Goods of Special Importance) Act, 1957, at the time of clearance of such final products, nothing contained in this notification shall apply in respect of such final products even if the duty of excise or the additional duty of excise, as the case may be, leviable on such final products is paid after such removal.

7. The provisions of this notification shall not apply to final products on which duty of excise leviable under the Central Excises and Salt Act, 1944 or as the case may be, the additional duty leviable under the Additional Duties of Excise (Goods of Special Importance) Act, 1957, has not not been levied or paid or has been short-levied or short paid or erroneously refunded by reason of fraud, collusion or any wilful mis-statement or suppression of facts, or contravention of any of the provisions of the said Central Excises and Salt Act or of the rules made thereunder with intent to evade payment of duty.

Explanation I :- For the purposes of this notification, "composite mill" means a manufacturer, who is engaged in the processing of fabrics with the aid of power alongwith spinning of yarn from fibres and weaving or knitting or crocheting of fabrics within the same factory.

Explanation II :- For removal of doubts, it is clarified that the provisions of this notification shall not apply where processed fabric itself is used as an input for further processing.

8. This notification shall come into effect on and from the 4th day of September, 1996.

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