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TMI Blog1984 (12) TMI 67X X X X Extracts X X X X X X X X Extracts X X X X ..... the more convenient distribution of other varieties of paper, in terms of Rule 56A(2) of the Central Excise Rules, 1944 ?" 2. The facts behind the legal formulation are these : The assessee is a company engaged in the manufacture of different varieties of paper; one of them is a wrapper paper which is exclusively used for captive consumption. The wrapper paper falls within Tariff Item No. 17 of the First Schedule to the Central Excises and Salt Act, 1944. It is also included in Item No. 8 of the notification issued under Rule 56A of the Central Excise Rules, 1944. Initially, duty is paid on wrapper paper manufactured, and thereafter, it is taken for use for wrapping other varieties of paper for more convenient distribution thereof. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ducts to enable their more convenient distribution. It is common ground that wrapping paper in the present case is used not for its own convenient distribution but for the distribution of other varieties of paper. In this view of the matter we find that the order of the Appellate Collector is contrary to the provisions of Rule 56A. Accordingly we allow the appeal, set aside the order of the Appellate Collector and restore the Order C. No. V/17/30/5/82-MP. I, dated 26-4-1982 of the Assistant Collector. (S. KALYANAM) (C.T.A. PILLAI)" MEMBER MEMBER 3. The answer to the question turns on the scope of Rule 56A. The relevant portion of the Rule reads : 'RULE 56A. Special procedure for movement of duty paid materials or component parts fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... * * * The two primary conditions to be complied with for the application of the rule are : (i) Duty must have been paid for the material in respect of which proforma credit is claimed; and (ii) The material and the other excisable goods must fall under one and the same item of the tariff. It is not in dispute that both these conditions are complied with by the assessee. The wrapper paper and other varieties of paper which are wrapped fall under the same Item No. 17 of the tariff and duty is paid on wrapper paper. Rule 56A is clumsily worded. The relevant portion of the Rule, as may be applicable to the present case, to put it in simple language : "The Collector may permit a manufacturer of any excisable goods (paper) to receive a m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eady paid on one product. Evidently the finished product in the context in which the words have been used under Rule 56A(2) must be a different product from the product on which the duty has been already paid, and it is in respect of that duty paid that the rebate is required to be allowed. Therefore, it is not correct to state that the product should be used for convenient distribution of the same duty paid product in order to claim rebate. The view that we have taken finds support from the decision of the Andhra Pradesh High Court in M/s. Bhadrachalam Paper Boards Ltd., Sarapaka, A.P. v. The Collector of Central Excise, Hyderabad (Case Referred No. 60 of 1984 disposed of on June 27, 1984) [1984(18) E.L.T. 229 (A.P.)]. The question refer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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