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TMI Blog2010 (8) TMI 223X X X X Extracts X X X X X X X X Extracts X X X X ..... r first clearances starting from 1st April of the financial year upto the limit prescribed in it, a concessional rate of duty of 60% of normal rate of duty. Subsequently, Notification No. 9/98-C.E., dated 2-6-98 was issued in supersession of Notification No. 38/97-C.E. and this notification also prescribed concessional rate of duty of 60% of the normal rate with Modvat benefit, for first clearances starting from 1st April of the financial year upto the limit of Rs. 50 lakhs prescribed in the Notification and a concessional rate of 80% of the normal rate with Modvat benefit for next Rs. 50 lakhs worth clearances immediately following the first Rs. 50 lakhs worth clearances. The concessional rate of duty, however, was subject to certain conditions as prescribed in the Notification. When Notification No. 9/98-C.E., dated 2-6-98 was issued, the Appellant again filed a declaration that w.e.f. 1-7-98, that they would avail of this exemption. However, from the scrutiny of their RT.12 returns, it was found that they had been paying duty at the normal rate from 1-4-98 till 31-7-98. The Appellant again vide their letter dated 3-8-98 wrote to the Range Officer that w.e.f. 1-8-98, they would a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncial year if during the previous period, the assessee was paying duty at normal rate without availing of this exemption; that what is prohibited in the notification No. 9/98-C.E. is that having opted to avail of this exemption, the assessee cannot thereafter opt to switch over to Notification No. 8/98-C.E. for the rest of the financial year and in this case, this was not the request of the Appellant, that there is no basis for the Department's decision that just because during the period from 1-4-98 to 31-7-98, the Appellant had paid duty at normal rate, they cannot opt for Notification No. 9/98-C.E. w.e.f. 1-8-98; that in this regard, they rely upon the Tribunal's judgment in the case of Sonodyne Electronics Co. Pvt. Ltd. v. CCE reported in 2004 (171) E.L.T. 397 (Tri.-Kolkata) wherein it was held that the benefit of Notification No. 9/98-C.E., dated 2-6-98 is available to an Assessee irrespective of the fact whether the clearances prior to 2-6-98 had been made at Nil rate of duty or at full rate of duty or under Notification No. 38/97-C.E.; that the Appellant while exercising the option to avail of the concessional rate of duty under Notification No. 9/98-C.E. w.e.f. 1-8-98 had t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... powers conferred by sub-section (1) of Section 5A of the Central Excise Act, 1944 (1 of 1944) and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 38/97-Central Excise, dated the 27th June, 1997, the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts clearances, specified in column (2) of the Table below, (hereinafter referred to as the said Table) for home consumption, of excisable goods of the description specified in the Annexure appended to this notification (hereinafter referred to the specified goods), from so much of the duty of excise leviable thereon which specified in the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), as is excess of the amount calculated at the rate specified in the corresponding entry column(3) of the said Table : S. No. Clearances Rate of duty 1. First clearances upto an aggregate normal Value not exceeding fifty lakh Rupees in the financial year 1998-99 Sixty percent of rate of duty 2. Clearances upto an aggregate value Not exceeding fifty lakh rupees immediat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1998-99. Illustration IV : A manufacturer operating as on 1st April, 1998 under Notification No. 16/97-C.E. makes clearances worth Rs. 30 lakhs at nil rate of duty till 1st June, 1998. With the coming into effect of Notification No. 8/98-C.E. on 2nd June, 1998, he is deemed to have switched over to that notification. He makes further clearances for home consumption after 2nd of June, 1998, having a value of Rs. 8 lakhs and thereafter he opts for payment of duty under this notification (i.e. 9/98-C.E.). He is entitled to additional clearances (at the concessional rate of 60% of normal duty) upto a value of Rs. 12 lakhs during the remaining part of the financial year}. Note II : Further, if the aggregate of the aforesaid clearances exceeds Rs. 50 lakhs, then such of the aggregate amount which is in excess of Rs. 50 lakhs shall be taken into account for the purposes of S. No. 2. ILLUSTRATION REGARDING S. NO. 2 OF TABLE A manufacturer who avail of exemption under notification No. 38/97-C.E., dated 27th June, 1997 made clearances worth Rs. 50 lakhs (at the concessional rate of 60% of normal rate of duty) and Rs. 12 lakhs worth of clearances ( at the concessional rate of 80% of n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s upto aggregate value not exceeding Rs. 50 lakhs immediately following the above mentioned Rs. 50 lakhs worth clearances, the concessional rate of duty prescribed is 80% of the normal rate of duty. As per note 1 of the notification if any clearances for home consumption have been effected before 2-6-98 under Notification No. 16/97-C.E., dated 1-4-97 whether at nil rate of duty or otherwise or under Notification No. 38/97-C.E., dated 27-6-97, such clearances together with clearances for home consumption, if any, effected or on after 2-6-98 under Notification No. 9/98-C.E. shall be taken into account for computing the limit of Rs. 50 lakhs in S. No. 1 of the table i.e. for calculating, the first clearances in the financial year 1998-99 upto aggregate value not exceeding Rs. 50 lakhs. This note has also been explained in the Notification by illustration. Thus for example, if a manufacturer during the period from 1-4-98 to 1-6-98 had made clearances worth Rs. 30 lakhs at nil rate of duty or otherwise under Notification No. 16/97-C.E. or under Notification No. 38/97-C.E., he would be entitled to concessional rate of duty of 60% of the normal rate of duty only in respect of further clea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ior to this date would be taken into consideration for the purpose of computing the limit of Rs. 50 lakhs. We are of the view that the ratio of this judgment is squarely applicable to the facts of this case and just because during the period from 1-4-98 to 31-7-98, the appellant had paid duty at normal rate without availing Notification No. 38/97-C.E., they cannot be denied the benefit of Notification No. 9/98-C.E. w.e.f. 1-8-98, so long as the clearances effected at normal rate of duty during the period from 1-4-98 to 31-7-98 are taken into account while computing the aggregate value of first clearances up to value of Rs. 50 lakhs in the financial year. From the Appellant's letter dated 14-10-98 addressed to Asstt. Commissioner, it is seen that the aggregate value of the clearances from 1-4-98 to 31-7-98 was Rs. 12,32,822/- and they had claimed concessional rate of duty at the rate of 60% of the normal rate in respect of another clearances worth Rs. 37,67,198/- and thereafter the concessional rate of 80% of the normal rate for the balance clearances of Rs. 50 lakhs. Thus while calculating the value of the clearances eligible for concessional rate of duty, the Appellant have includ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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