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TMI Blog2013 (5) TMI 735X X X X Extracts X X X X X X X X Extracts X X X X ..... usiness of manufacturing woolen felt which is excisable product. In addition to clearing such final product for home consumption, the petitioner also exports such goods. The Government of India had issued a Notification No. 8/2001 dated 1-3-2001 and granted exemption to Small Scale Industrial Units from payment of excise duty and additional duty on clearances for home consumption upto a limit of value of Rs. 100 lakhs, subject to certain conditions provided therein. 2.1 The petitioner for the clearances of its final product for home consumption, availed of duty exemption benefit flowing from such Notification No. 8/2001. 2.2 The petitioner exported the said goods on or around 14-9-2001 valued at Rs. 15,27,800/-. At the time of clearance o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e held that clause (iv) of para 2 of the Notification No. 8/2001 restricts utilization of credit of duty on capital goods till first aggregate value of clearances which do not exceed Rs. 100 lakhs in the manner specified in the table provided in the notification. He, therefore, concluded that, "Thus, I observe that restriction of cenvat utilization from capital goods is applicable for aggregate first clearance value less than Rs. 100 lakhs irrespective of mode of consumption i.e. home consumption or export.". 2.5 On such basis, the rebate claim of the petitioner was disallowed. The petitioner preferred appeal against such order before the appellate authority. Before the appellate authority, the petitioner contended that Notification No. 8/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isional authority substantially approved the interpretation adopted by the adjudicating officer, particularly of clause (iv) of para 2 of the Notification No. 8/2001. The petitioner's interpretation was rejected. Following observations were made : "The appellants submit that, this condition w.r.t. Clearance for home consumption not for export. Govt. observes that, in other words as per this interpretation, this condition says that duty should not be paid by way of utilization of capital goods credit on clearances for home consumption upto Rs. 100 lakhs. But, the Small Scale Exemption notification, to avail the benefit of which, the above is one condition, exempts clearances for home consumption upto Rs. 100 lakhs from payment of duty. Then ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... para 2 of Notification No. 8/2001 was correctly interpreted. 5. From the above, it can be seen that the central question to be decided in the present proceedings is the true interpretation of Notification No. 8/2001 and in particular, clause (iv) of para 2 thereof. Before trying to interpret such provision, we may reiterate the admitted facts. The petitioner is manufacturer clearing final product for home consumption as well as export. During the year under consideration, the petitioner's clearances did not exceed Rs. 100 lakhs. Part of the clearances were made for export. On such export, the petitioner claimed rebate of excise duty paid. Such excise duty was paid by adjustment of cenvat credit on capital goods. 6. Notification No. 8/200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h an exemption could not avail the credit of duty on inputs used in manufacture of specified goods cleared for home consumption upto the maximum limit of Rs. 100 lakhs. In simple terms, therefore, a manufacturer seeking benefit of such exemption notification was not entitled to avail credit of duty on inputs used in the manufacture of goods of which such exemption was being availed and cleared for home consumption and of which the exemption was availed. 6.3 Clause (iv) of para 2 thereof which is crucial for our purpose, further provides that the manufacturer also would not be entitled to utilize the credit of duty on capital goods, paid on such goods for payment of duty on the aforesaid clearances upto an aggregate of Rs. 100 lakhs. Here t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lete without any segregation. In the earlier notifications, however, there were different slabs, for example, in the Notification No. 8/2000 dated 1-3-2000, such exemption was granted fully on first clearances upto an aggregate not exceeding value of Rs. 50 lakhs. Thereafter, a partial exemption was granted for clearances not exceeding Rs. 50 lakhs over and above such initial clearances in which case, the rate of duty payable was 5%. In such notification, condition No. (iv) in para 2 read as under :- "2(iv) The manufacturer also does not utilize the credit of duty under rule 57Q of the said rules, paid on capital goods, for payment of duty, if any, on the aforesaid clearances, the aggregate value of first clearances of which does not excee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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