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TMI Blog2018 (5) TMI 379X X X X Extracts X X X X X X X X Extracts X X X X ..... he ground that during the period March, 2010 and June, 2010, the appellant cleared their goods falling under Chapter sub-heading 33012590 on payment of duty in contravention of the Exemption Notification with an intent to take undue benefit of the said Notification by way of self credit refund and because of which the said amount of Rs. 29,83,906/- did not represent proper and lawful duty in terms of section 3 of the Central Excise Act, 1944. Accordingly, the self credit taken by the appellant in respect of this duty also did not proper to be correct/admissible after issuance of the Exemption Notification. It may be mentioned that the exemption under the Notification No.56/2002-CE dated 14.11.2002 as amended, was admissible only in respect of the amount of the specified duties payable and the exemption in this Notification was granted by way of refund as per the unique mechanism laid down in the Notification. The refund was of the duties which were otherwise payable but were exempted under the said Notification. Since the exempted under the said Notification was of the duties payable, and no duty was payable on the exempted goods cleared during the month of March, 2010 and June, 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ough PLA is not duty within the provision of section 11A. Therefore, the impugned order is to be set aside. 6. On the other hand, learned AR submits that as per the Notification No.10/10-CE dated 17.2.2010, the goods were exempt from the payment of duty and the appellant has paid duty on their own and took self-credit of the same which is not permissible, therefore, erroneously self-credit taken by the appellant is required to be refunded by them. 7. Heard both sides and considered the submissions. 8. On careful consideration of the made by both sides, the following issue emerge: (i) Whether in case Notification No.56/02-CE dated 14.11.2002 and Notification No.10/10-CE dated 17.2.2010 are in force during the relevant period whether the appellant can be forced to follow Notification No.10/10-CE dated 17.2.2010. (ii) Whether in terms of Notification No.10/10-CE dated 17.2.2010, the appellant is not required to pay duty and he has paid duty whether the provisions of section 11A of Central Excise Act, 1944 are applicable or not? Issue No.1 9. This issue came up before the Hon'ble Apex Court in the case of HCL Limited (supra) wherein the Hon'ble Apex Court has observed as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is open to the assessee to choose which is more beneficial to him. Admittedly, when the appellant chooses notification No.56/02-CE, therefore, the same cannot be denied to the appellant. 12. With these observations, we hold that the appellant has rightly claimed the benefit of Notification No.56/02-CE by paying duty through PLA and taken the self-credit which is permissible to the appellant. Therefore, the issue No.1 is answered in favour of the appellant. Issue No.2 13. We have gone through the show cause notice as well as the impugned order. The allegation against the appellant is that the appellant is not required to pay duty as the appellant is not required to pay duty on the goods and whatever amount paid by the appellant through PLA and taken self-credit is required to be refunded. As the same is not duty, as per the provisions of section 11A of the Act, the provisions of section 11 A are not applicable to the present case. Therefore, we hold that the show cause notice issued to the appellant in violation of the provisions of section 11A of the Act and the same is not sustainable. 14. In view of the above observations, the issue No.2 is also answered in favour of the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ys Ltd. Vs. Commissioner of Cus., Ahmedabad - 2010 (255) ELT 124 (Tri.-Ahmd.). In this context, Section 5A (1A) of the Central Excise Act reads as under:- "1(A) for the removal of doubts, it is hereby declared that where an exemption under sub-section (1) in respect of any excisable goods from the while of the duty of excise leviable thereon has been granted absolutely, the manufacturer of such excisable goods shall not pay the duty of excise on such goods." 4. The above provision is in the statute itself whereas both the notifications which have been issued under Section 5A of the statute are delegated legislation. Hence, the essential question is whether the statutory provision of Section 5A(1A) would prevail over the delegated legislation in the form of notification. It is settled law that the statutory provisions have primacy over the delegated legislation as has been held by the Hon'ble Supreme Court in the case of Corporation Bank Vs. Saraswati Abharansala - 2009 (233) ELT 3 (SC). The same view was taken by the Hon'ble Supreme Court in the case of Amrit Paper Vs. CCE, Ludhiana - 2006 (200) ELT 365 (SC), wherein the Hon'ble Apex Court held as below:- "13. As ri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... son, the notification speaks of duty payable and duty paid. Hence, it is incorrect to say that what is being paid and what is being refunded does not have the character of duty. The notification itself in Para 2C(g) while dealing with irregular availment of self credit mention that "shall be recoverable as if it is a recovery of duty of excise erroneously refunded". Thus, even for self credit, which is a book entry instead of cash refund, deeming provision to treat it as duty has been created. I also find from the findings of the I-d. Commissioner (Appeals) that the appellants while contesting that Section 11A of the Act was not applicable had themselves stated that demand for month of March, 2010 was barred by limitation under Section 11A of the Act. Hence, the duty payment and recovery of erroneous refund are governed by the Section 11A of the Act, which provides the necessary statutory platform for determination of demand. In view of above, the demand has been correctly raised under Section 11A of the Central Excise Act, 6. The appellants have also pleaded that the goods manufactured by them are not covered by Serial No.66A of the Notification No.04/2006-CE as amended by the No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as referred to the third Member on the following points of difference "(A) Whether in the facts and circumstances of the case, the appellant is entitled for the benefit of Notification No. 56/02-CE dated 14/11/2002 as held by Member (Judicial) or the appellant were required to comply with express provisions of sub-section (1A) of Section 5A of Central Excise Act, 1944 and the Notification No. 10/10-CE dated 27/02/2010 is applicable in the facts and circumstances of the case as held by Member (Technical) ; (B) In alternate, if it is held by the Member (Technical) that appellant is entitled for the benefit of Notification No. 10/10-CE dated 27/02/2010, wherein the appellant is not required to pay duty, therefore, inadmissible re-credit under Notification No. 56/2002-CE, taken by the appellant is recoverable under the provisions of Section 11A of the Central Excise Act, 1944, as held by Member (Technical). Or, the provisions of Section 11A of the Act are not applicable to the facts of this case as held by Member , (Judicial) wherein he has held that, as no duty is payable in terms of Notification No. 10/10-CE dated 27/02/2010, therefore the provisions of Section 11A of the Act are n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that since the appellant is eligible for full exemption under Notification 10/2010-CE, the amount paid by them in terms of Notification 56/2002-CE cannot at all be considered as excise duty and, hence, the question of refunding the same will not arise. However, I note in the order recorded by the learned Member (Technical) it is specifically stated that it is incorrect to say that what is being paid and what is being refunded does not have the character of duty. Accordingly, he proceeded that Section 11A of the Act will apply. The payment of duty on value added portion is a specific requirement to avail Notification 56/2002-CE. In other words, such payment is clearly for claiming the same back to the appellant. As already stated this is the mechanism evolved for applying the exemption. 5. I have perused the findings recorded by both the Members. Having noted that both are exemption notifications issued under exemption 5A, I am in agreement with the findings recorded by Member (Judicial) based on the ratio of various decisions of the Hon'ble Apex court regarding the choice available to the claimant when more than one exemption is available on the same goods. The case law ..... X X X X Extracts X X X X X X X X Extracts X X X X
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