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TMI Blog2013 (4) TMI 468X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 1-3-2002 as amended by Notification No. 23/2004-C.E., dated 9-7-2004. The applicants also manufacture parts of tractors, viz. IC Engines, Transmission, assembly Sheet Metal components etc., classifiable under Ch. 84 & 87 of the Central Excise Tariff. Thus both the Tractors, as well as parts of tractors, referred above as "aggregates" by the applicant are exempted from payment of duty, vide Sr. Nos. 295 & 296 of Notification No. 6/2002-C.E., dated 1-3-2002, as amended by Notification No. 23/2004-C.E., dated 9-7-2004. The applicants chose to pay the duty on the aggregates used in the manufacture of tractors exported. The applicants filed their claim for drawback of the duty paid on inputs used in the manufacture of tractors exported. With respect to the claim for the drawback of the duty paid on aggregates used in the manufacture of tractors exported, the adjudicating authority rejected the applicants claim for drawback of the duty on "aggregates" on the ground that the applicant was not liable to pay duty on the aggregates, and as such their claim has not been considered for allowing drawback. 3. Being aggrieved by the said Order-in-Original passed in a letter format, the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fies nil rate of duty in respect of the parts manufactured and captively consumed in the manufacture of tractors, is a conditional notification and not absolute notification. 4.5 A Close reading of Section 5A(1) and Section 5A(1A) would clearly show that the Central Government has power, by way of issuing notification, to exempt either absolutely or subject to conditions as may be specified in the Notification. In other words exemption granted can be either absolutely (Unconditional) or subject to certain conditions stipulated in the notification itself. However, section 5A(1A) would apply only in the case where the exemption from the whole of the duty is granted absolutely i.e. unconditionally. When the notification grants exemption from the whole of the duty by stipulating the condition in the notification then such notification is not covered under Section 5A(1). The excisable goods covered by full exemption subject to certain condition are not covered by the bar provided under Section 5A(1A). 4.6 The exemption granted to parts of the tractor by Sl. No. 296 of Notification No. 6/2002-C.E. is subjected to the condition that they are captively consumed in the manufactu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ule 6 and Rule 7 the duties paid on the material used in the manufacture of goods exported should be taken into account. In the present case, it is as undisputed fact that the duties had been paid on the aggregates. The Assistant Commissioner of Central Excise in his Order-in-Original dated 29-6-2007 also did not dispute the fact that the applicants had to pay the duty on the aggregates. In fact he proceeds on the basis that the duty should have been paid on 5th of the month succeeding the month in which the aggregates are used in the manufacture of tractors cleared for export. Therefore, when the duty has already been paid on the aggregates, the same had to be taken into account for determining the brand rate of drawback. The Commissioner of Central Excise (Appeals) in his earlier Order-in-Appeal dated 14-9-2007 also specifically held that duty is payable on the aggregates. The impugned order of Commissioner of Central Excise (Appeals) in upholding the order of Additional Commissioner fixing the brand rate without considering the duties paid on the aggregates is therefore incorrect and unsustainable in law. 4.10 By M.F. (D.R.) Circular No. 14/2003-Cus., dated 6-3-2003 issued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... referred appeal against the impugned Order-in-Original before the Commissioner (Appeals), who rejected the same by upholding the impugned Order-in-Original. 8. Government observes that in this Revision Application, the applicant has mainly contended that the Commissioner (Appeals) in their earlier order dated 14-7-2009 specifically held that duty was payable on such aggregates and hence Commissioner (Appeals) order in this case is contrary to stand taken by him in earlier order dated 14-7-2009. The applicant also submitted that Sr. No. 296 of the Notification No. 23/2004-C.E., dated 9-7-2004 [which amended Notification No. 6/2002-C.E., dated 1-3-2002] exempts the parts of tractors, is conditional in nature as it specify the condition that they are to be captively consumed in the manufacture of tractor and as such the entry is not absolute in nature. Government notes that in earlier appeal, the issue before the Commissioner (Appeals) was not the dutiability of the aggregates, but the interest on payment of duty. The applicants paid the duty on its own volition, and the same was not even agitated by them before the lower authorities and as such the applicants contention that Co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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