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TMI Blog2009 (4) TMI 62X X X X Extracts X X X X X X X X Extracts X X X X ..... eemed credit order issued by the Ministry - though the department may be bound by its trade note, the industry is not bound by the same - petitioner was entitled to avail benefit of the deemed credit order since he was availing benefit of the notification dated 28.2.1993. - 10 of 2001 - - - Dated:- 10-4-2009 - Deepak Gupta, and V.K.Ahuja, JJ. Mr. Sudeep Singh, Advocate, for the Petitioner. Mr. Sandeep Sharma, Assistant Solicitor General of India, for the respondents. [Judgment per : Deepak Gupta, J.] - This Excise Reference was admitted on the following questions of Law: "1) Whether, in the facts and circumstances of the case, the Tribunal was right in interpreting the Notification dated 28.2.1993 and the Deemed Credit Ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies or (b) from any factory by one or more manufacturers, had exceeded Rs.2,00,00,000/- in the preceding financial year. A bare perusal of this notification shows that benefit of this notification was only available to such units whose total clearances in the preceding financial year did not exceed Rs.2 crores. The effect of the notification may be summarized as follows:- (1) In the case of first clearances of the specified goods upto an aggregate value not exceeding Rs.30,00,000/-. (a) manufacturer avails of the benefit of Modvat credit, then the exemption was to the extent of 10% ad valorem subject to the condition that a minimum of 5% ad valorem duty was payable. (b) If the manufacturer did not avail of the benefit of Modvat cre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the current financial year exceeded Rs.2,00,00,000/-(Rs.75,00,000/- exempted and rest not exempted). Thus a manufacturer whose total clearance in the previous year did not exceed Rs.2 crore could get the benefit as provided in the notification. However, this benefit was limited to the clearances amounting to Rs.75 lacs only and for clearances over and above Rs.75 lacs the manufacturer was liable to pay the full duties. The Excise Ministry thereafter issued a Deemed Credit Order dated 1.3.1994 which reads as follows:- "In exercise of the powers conferred under the second proviso to Rule 57G(2) of the Central Excise Rules, 1944 (1 of 1944), and in superssion of Order F.No.342/5/91-TRU dated 7 th July, 1992, as amended, the Central Go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he exemption of limit of Rs.75 lacs. The Deputy Commissioner, Excise confirmed the demand in view of the trade notice referred to above. The petitioner filed an appeal and the Commissioner allowed the appeal relying upon the decision of the Appellate Tribunal in the case of Collector of Central Excise, Coimbatore v. Sri Venkateswara Steel Industries - 1996 (86) E.L.T. 446 (Tribunal). This judgment of the Two Member Bench was reconsidered by a Three Member Bench of the Customs, Excise and Gold (Control) Appellate Tribunal (CEGAT) in the Dagambar Foundary versus Commissioner of Central Excise, Allahabad 2000 (118) E.L.T. 85 (Tribunal-LB). The Larger Bench held that any manufacturer whose clearances are over Rs.75 lacs cann ..... X X X X Extracts X X X X X X X X Extracts X X X X
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