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TMI Blog2003 (2) TMI 334X X X X Extracts X X X X X X X X Extracts X X X X ..... sioner under the impugned Order and whether penalties under Section 11AC of the Act read with Rules 9(2) and 173Q of the Central Excise Rules on the appellant- company and under Rule 209A on the other Appellants are imposable. 2. Shri M. Chandrashekharan, learned Senior Advocate, submitted that the appellant-company is engaged in the processing of cotton and man-made fabrics; that with effect from16-12-1998, they started paying duty under the Compounded Levy Scheme under Notification No. 36/98-C.E., dated 10-12-1999 at the rate of Rs. 7.5 lakhs per month; that by Notification No. 2/99-C.E. (N.T.), dated 13-1-1999 the independent processors having proprietary interest in the spinning of yarn or weaving or knitting of fabrics were exclude ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m rate will be applicable to the textile fabrics manufactured or produced prior to 13-1-99 and cleared on or after that date. 3. The learned Senior Counsel submitted that the duty has been demanded from the Appellants in respect of man-made fabrics and cotton fabrics, whereas clause (aa) of Para 6 of Notification No. 2/99-C.E., dated 13-1-99 applies to processed textile fabrics of cotton or man-made fibres, falling under Heading No. 58.01, 58.02, 60.01 or 60.02 of the Schedule to the Central Excise Tariff Act; that their products are not falling under any of the Headings mentioned in the said clause; that this is evident from the TR 6 Challan wherein the products manufactured by them and Tariff Heading Nos. 55.14 and 52.07 are mentioned. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es. It is not in dispute that the Appellants were discharging their duty liability under the Compounded Levy Scheme under Section 3A of the Act read with Notification No. 36/98-C.E. being independent processors manufacturing goods falling under the specified Headings of the Tariff which had been notified by the Central Government under Notification No. 41/98-C.E. (N.T.), dated 10-12-98 to which the provisions of Section 3A of the Central Excise Act would apply. As per Para 2 of Explanation II of this Notification, independent processor was defined as under : Explanation II : For the purposes of this notification, an independent processor means a manufacturer who is engaged exclusively in the processing of fabrics with the aid of power ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Deluxe Bar. It has been contended by the Appellants that under Compounded Levy Scheme, they had discharged the duty liability on 4-1-99 and no further duty liability remained to be paid by them and the decision in the case of Deluxe Bar applies squarely in the present matter. In the said judgment, the licence fee of various licences under the Andhra Pradesh Foreign Liquor/Indian Liquor Rules, 1970 had been enhanced by a Government Order dated 3-3-1990 and the enhancement was to come into effect from 1-4-1990. The Supreme Court has held that the enhanced licence fee would only be effective from commencement of next excise year as there was no clear language in the amended provisions that the enhancement would affect the existing lice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... falling under some of the specific Heading of Chapter 58 and Chapter 60 were brought within the purview of Compounded Levy Scheme. Similarly, the Notification No. 36/98-C.E. was also amended by Notification No. 2/99-C.E. providing rate of duty for the new products brought under the Scheme. In that context Para (aa) was inserted in Para 6 of Notification No. 36/98 to provide that the goods falling under this specific Heading of Chapters 58 and 60 produced before 13-1-99 and cleared on or after that date will not be covered by Notification No. 36/98 that is by Compounded Levy Scheme. This clause (aa), in our opinion, does not provide any retrospective effect to Notification No. 2/99. Accordingly, we hold that no differential duty is chargeabl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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