9911796707
TMI Blog2007 (9) TMI 140X X X X Extracts X X X X X X X X Extracts X X X X ..... the benefit of the said Notification. The Joint Commissioner demanded duty of Rs. 10,74,244/- along with interest under Section 11AB. He allowed Cenvat credit to the tune of Rs. 7,35,535.51. Penalty of Rs. 3,38,700/- was imposed under Section 11AC. Penalty of Rs. 10,000/- was imposed on Shri T. Vijaya Bhaskar, Director, of the Company under Rule 26 of the Central Excise Rules, 2002. The respondent approached the Commissioner (Appeals) against the Order-in-Original dated 29-3- 2004. The Commissioner (Appeals) allowed the appeal of the Respondent by setting aside the said Order-in-Original. Revenue is aggrieved over the impugned Order-in-Appeal on the following grounds :- The respondents clear their final products HDPE/PP Ropes without payme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Circular No. 680/71 /2002-CX dated 10-12- 2002 has correctly held that the Respondents are entitle for the benefit of exemption Notification No. 6/2002-C.E. dated 1-3-2002 in respect of HDPE/PP Granules cleared during the period from 26-9-2002 to 28-2-2003. 4. We have gone through the records of the case carefully. The Respondents use duty paid HDPE/PP Granules. The PP Granules are first converted to monofilament and thereafter the monofilament is used to manufacture ropes. Similarly intermediary products strips are produced and thereafter they are used to manufacture ropes. In terms of Notification No. 6/2002 dated 1-3-2002, the above final products are exempted subject to certain conditions. The said condition No.34 is reproduced herein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to be goods on which duty of Excise has been paid. 5. The above clarification dated 26-9-2002 was used against the assessees in the context of Notification No. 14/2002 dated 1-3-2002. The above Notification provides concessional rate of duty at 12% Adv. for textile fabrics manufactured by a composite mill or a manufacturer engaged in the processing of fabrics along with weaving or knitting or crocheting of fabrics within the same factory from textile fibres or yams respectively on which the appropriate duty has been paid. In respect of composite mill, the textile yarns emerge at intermediate stage of production and they are exempt from excise duty under the captive consumption Notification No. 22/96-C.E. dated 23-7-1996. Therefore it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplicable in the facts of the case. The impugned order, demanding duty is not tenable." It is further seen that the respondent had not availed Cenvat credit on the duty paid granules purchased from suppliers of raw materials. We agree with the finding in the impugned order that the mere fact that intermediate product is exempted from payment of duty does not in any way affect the claim of the respondents for exemption from duty in respect of plastic ropes. The Apex Court in the Dhiren Chemicals case (supra) referred to "raw materials". In other words, only when no duty has been paid on raw material the exemption cannot be given. In the present case, the fact that the raw material namely granules are duty paid is not in dispute. Hence the C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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