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TMI Blog2005 (2) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... n. It was for the assessee to prove by evidence the participation of AC Sheets in the manufacture of filament/cotton yarn, which has not been done and, therefore, the tribunal had erred in admitting the claim of the assessee for exemption without analyzing the Notification No. 123/81 dated 2-6-1981 (as amended). Thus civil appeal filed by the department succeeds; the impugned judgment and order of the tribunal is set aside. - 5830 of 1999 - - - Dated:- 17-2-2005 - S.N. Variava, Dr. A.R. Lakshmanan and S.H. Kapadia, JJ. [Judgment per : S.H. Kapadia, J.]. - The issue in this civil appeal filed by the department under section 35L(b) of the Central Excise Act, 1944 relates to the eligibility to the benefit of exemption under Notification No. 123/81-C.E., dated 2nd June, 1981, as amended. 2.M/s Ginni Filaments Ltd. (hereinafter referred to for the sake of brevity as "the assessee") is 100% Export Oriented Unit manufacturing filament yarn. The assessee was licensed under Section 58 of the Customs Act 1962 bearing Licence No. 1-Customs/90 dated 13-3-1990. The assessee was also granted L-4 licence for the manufacture of cotton yarn falling under Chapter 53. 3.The assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l goods, components and raw materials, consumables, spares and packaging materials (hereinafter referred to as the goods) when brought in connection with the manufacture and packaging of articles into an undertaking approved by the Board of Approval for hundred per cent Export Oriented Undertakings appointed by the notification of Government of India in the former Ministry of Industry and Civil Supplies (Department of Industrial Development) No. S.O. 163(E)/RLIU/10(2)/76 dated the 3rd March, 1976 from the whole of :— (i) the duty of excise leviable thereon under section 3 of the Central Excises and Salt Act, 1944 (1 of 1944); and (ii) the additional duty of excise leviable thereon under sub-section (1) of section 3 of the Additional Duties of Excise (Goods of Special Importance) Act 1957 (58 of 1957), subject to the following conditions namely:- (a) the hundred per cent export-oriented undertaking is approved by the said Board; (b) the goods required by such undertaking for manufacture and packaging of articles are brought directly to the factory of manufacture and are used in the manufacture and packaging of such articles meant solely for expo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15% ad valorem and from the whole of the additional duty of excise leviable thereon under sub-section (1) of Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957), subject to the following further conditions, namely :- (i) the said undertaking produces a certificate to the Assistant Collector of Central Excise, prior to the clearance of such articles from the General Manager or the Project Manager of the Oil and Natural Gas Commission or the Oil India Limited or as the case may be the Gas Authority of India Limited to the effect that such articles are required to be supplied against global tender to the Oil and Natural Gas Commission or the Oil India Limited or as the case may be the Gas Authority of India Limited for their project in India specified in the Certificate; and (ii) the said undertaking produces to the Assistant Collector of Central Excise within three months from the date of the said clearance of such articles or such extended period as may be allowed by the Assistant Collector of Central Excise, a certificate from the General Manager or the Project Manager of the Oil and Natural Gas Commission or the Oil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs of the bond; and (ii) the specimen signature of the agent of the said undertaking furnished on the body of the certificate is genuine and he would attest it. The certificate shall be sent by the said officer-in-charge under registered post (acknowledgement due) to the factory from which the goods are to be obtained. A copy of the certificate shall also be sent by the said undertaking to the Superintendent in-charge of the range of the factory from where the goods are to be received. (b)Removal of goods to 100% Export oriented undertaking. - On receipt of the aforesaid certificate the factory (consignor) from where the goods have to be removed shall prepare an application in the form given in Annexure C below in quadruplicate for removal of non-duty paid goods from one warehouse to another mentioning clearly the number and date of the bond in Annexure A below as per the certificate issued by the Central Excise officer-in-charge of the 100 per cent Export Oriented Undertaking. Removal application in Annexure C below must be serially numbered. The serial No. should be according to the financial year. The serial No. must be noted on all the copies. Whenever any removal ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Annexure E below and forwarded the same day to the Central Excise officer-in-charge of the 100 per cent Export oriented undertaking. The entries in this record should be verified against relative entries of the Record of Raw Materials prescribed by the Collector. (g)Responsibility for further accounting. - After delivery of the goods from a manufacturer, proper accounting of these goods shall be the responsibility of the Central Excise officer-in-charge of the 100 per cent Export oriented undertaking. (h)Examination of the consignment on receipt. - (1) The consignee must give intimation of the arrival of the consignment at his premises to the Central Excise officer-in-charge of the 100 per cent Export oriented undertaking without any delay and should store the same separately and intact pending examination and check by the said officer and the said officer, after taking account of the goods, will identify them with the marks and numbers, and weigh the consignment in full. Thereafter, he shall complete the re-warehousing certificate on the duplicate copy received from the Central Excise Superintendent-in-charge of the factory at destination and original and triplicate copy o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dure is committed by the applicant, his agent or any person employed by him. In the event of such a breach, the Collector of Central Excise may also order the forfeiture of the security deposited under paragraph (a) above and may also confiscate the goods and all articles manufactured from such goods in store in the premises of the 100 per cent Export oriented undertaking. (k)Despatch of duplicates by registered post acknowledgement due. - Despatch of duplicate application in Annexure B referred to in paragraph (a) above must always be made by registered post acknowledgement due, and the postal receipt acknowledgement must be systematically filed by the consignor and presented for inspection to the Central Excise officer-in-charge of the factory whenever required. (l)Demand of duty on goods not reaching destination. - Under sub-rule (1) of rule 156B of the Central Excise Rules, 1944, if the certificate of receipt of a consignment of the goods dispatched to the consignee [as per paragraph (1)] is not received back by the consignor within 90 days of the removal of the goods or within such extended period as may be allowed by the Collector of Central Excise, it is the responsibili ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00 per cent Export oriented undertaking to ensure that all the goods have been fully utilized for manufacture and packaging of articles intended for export or for clearances up to twenty five per cent of the articles produced or manufactured and allowed to be sold in India on payment of duty of excise leviable under section 3 of the Central Excises and Salt Act, 1944 (1 of 1944) or for clearances for supply to the Oil and Natural Gas Commission for their projects in India against global tender or are otherwise accounted for to the satisfaction of the Assistant Collector, Central Excise in-charge of the 100 per cent Export oriented undertaking. [Emphasis supplied]" 9.The above notification gave exemption to goods for "use" in 100% export oriented unit. As can be seen from the preamble, the notification gave exemption to capital goods, raw materials, components, consumables etc. compendiously known as "goods" when brought into the undertaking of a licensed holder from the 100% export oriented unit approved by the Board under a certificate in form CT-3 "in connection with the manufacture of" products to be exported out of India. The said notification exempted the above goods from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee is in the business of telecommunication. However, if the assessee is in the business of manufacture of hydrogen peroxide, the same instrument cannot be construed as "capital goods" for the purposes of the above notification. Hence, the peculiarities of the business or the undertaking is also required to be kept in mind while interpreting the said notification. 11.Applying the above tests to the facts of the case in hand, we find that the assessee has claimed exemption in respect of table, chairs, air-conditioners etc., which cannot be said to be "goods" used in the manufacture of cotton or filament yarn. It is the case of the assessee that the words "in connection with the manufacture" are wide enough to cover every item which is allowed to be removed under CT-3 certificate. This contention of the assessee is accepted by the tribunal erroneously as it has failed to look at the words used in the conditions enumerated in the notification. As stated above, we have to read the notification in its entirety. Further, we are dealing with exemption notification which has to be read strictly so far as the eligibility is concerned. It was for the assessee to prove by evidence, ..... 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