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TMI Blog2010 (9) TMI 561X X X X Extracts X X X X X X X X Extracts X X X X ..... P. Sheth, Advocates, for the Appellant. Shri N.A. Sayyed, JDR, for the Respondent. [Order per : P.G. Chacko, Member (J)]. - These appeals are directed against the Commissioner s order confirming demand of duty of over Rs. 72 lakhs against M/s. Universal Packaging (assessee) for the period from 2001-02 to 2005-06, demanding interest on duty under Section 11AB of the Central Excise Act, imposing penalty equal to duty on the assessee under Section 11AC of the Act and imposing separate penalty of Rs. 10 lakhs under Rule 26 of the Central Excise Rules on one of the partners of the above firm. The assessee was working as a small scale industrial unit manufacturing packing materials during the material period. They filed the requisite declaration with the department from year to year. Their clearances for home consumption were within the limit prescribed under the relevant SSI exemption Notification and, therefore, they claimed exemption from payment of duty on those clearances during the aforesaid period. The department, after scrutiny of records and connected enquiries, issued a show-cause notice on 12-12-2006 under the proviso to Section 11A(1) of the Central Excise Act a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... H and other equivalent sales tax forms, which had been recognised by the Board as proof of export, were also furnished but the same was rejected on the erroneous premise that the clearances in question were not covered by Rule 19(1) ibid. The counsel has invited our attention to a specimen form which would indicate that this document certified sale of goods in the course of export. He has also referred to the Board s Circular No. 212/46/96-CX., dated 20-5-1996. Learned counsel has also relied on the Tribunal s decision in Vadapalani Press v. CCE, Chennai, 2007 (80) RLT 498 (CESTAT - Che.) = 2007 (217) E.L.T. 248 (T) wherein a similar case was considered by the Tribunal and it was held that FORM-H was liable to be accepted as proof of export for purposes of Rule 19(1) and for the further purpose of excluding the export goods from the aggregate value of clearances of the manufacturer claiming SSI benefit. The cited judgment also met the Revenue s objection about the goods having not been exported directly from the factory of production. It was held thus : It would not cease to be proof of export by mere reason of the fact that the exportation was done by the customer from his own ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which were cleared for export did not satisfy Rule 19(1), the clearance should be counted as a clearance for home consumption and consequently such clearances must be added to the aggregate value of the clearances for home consumption for SSI purpose. This case of the Revenue is founded on the premise that, for applicability of Rule 19(1), the goods should have been exported from the factory of production and not from elsewhere. We find that the Tribunal s decision in Vadapalani Press case contains a pointed answer to this objection of the Revenue. Another ground raised by the Revenue for including the above clearances in the aggregate value of clearance for home consumption is that the documents filed by the assessee did not conclusively prove exportation of the goods. We find that the assessee filed Bills of Lading, Sales Tax forms like FORM-H, FORM-G1 etc. to prove that the cartons cleared by the assessee were actually exported. We find that in a similar factual situation, the Tribunal held in Vadapalani Press case that the sales tax forms evidencing sale of goods in the course of export were to be accepted as proof of export of goods manufactured by SSI unit, as per the Board ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ucts. The clarification in the italicized sentences of para 4.1.2 were taken from the Board s circular dated 25-7-2002 ibid and ld. SDR has laid emphasis on the same and has argued that a Form-H certificate would not be accepted as proof of export unless the SSI unit did not undertake exports either directly or through merchant-exporter directly from the SSI unit itself. In this case, it was pointed out by SDR, the exports were made by the appellants buyers from the latter s premises and not from the former s and, therefore, the appellants would not be entitled to employ the Form-H certificates as proof of export of the cartons supplied to their buyers. We are not inclined to accept this contention inasmuch as the Board s clarification as to the manner of exportation has to be understood conjointly with the relevant provisions of the Central Sales Tax (Registration and Turnover) Rules, 1957. Rule 10(a) of the CST (R T) Rules, 1957 reads as under : A dealer may, in support of his claim that he is not liable to pay tax under this Act in respect of any sale of goods on the ground that the sale of such goods is a sale in the course of export of these goods out of the Territory o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n were used by the buyers in the packing of goods exported by them. The details regarding exports which were required to be mentioned in the Schedule to each certificate were furnished in a tabular statement annexed to the document. Such a document was liable to be accepted as proof of export by the appellants customer, of the cartons supplied by the appellants. It would not cease to be proof of export by mere reason of the fact that the exportation was done by the customer from his own premises and not directly from the appellants factory. Therefore, we are of the view that the interpretation given by learned SDR to the Board s Circular No. 648/39/2002 [reported in 2002 (51) RLT M48] would not be consistent with the provisions of law governing issuance of Form-H certificate. It is not the case of the Revenue that the cartons supplied by the appellants to A.V. Thomas Co. and other similar customers were not exported. It is, however, pointed out that the cartons were not exported as such, but were only used as packing material for goods exported by the customers. We find that, in the case of M/s. Radhey Paper Udyog (supra), there was an identical factual situation. In that case, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other goods for export. This circular deals with Form-H procedure as applicable to SSI unit selling goods to a merchant-exporter. This would mean that it is open to the merchant-exporter to use packing materials supplied by the SSI unit for packing his own goods for export. By this activity, he does not turn manufacturer-exporter . In other words, M/s. A.V. Thomas Co. and other customers of the appellants who used the printed cartons supplied by the appellants for packing their own goods for export cannot be called manufacturer-exporters insofar as the cartons are concerned. They can only be called merchant-exporters of the cartons. Thus both the conditions proposed by learned SDR were satisfied by the appellants. Hence, by ld. SDR s yardstick also, the appellants must be held to have established their case for acceptance of Form-H certificates as proof of export in respect of the printed cartons supplied by them to M/s. A.V. Thomas Co. and other similar customers during the period of dispute. It is ordered accordingly. 7. Having found striking parallel between this case and the above case, we follow the ratio of the above decision of this Tribunal and hold that th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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