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TMI Blog2005 (5) TMI 158X X X X Extracts X X X X X X X X Extracts X X X X ..... they were charged that they have cleared 323487.60 kgs. of processed cotton yarn without payment of duty under the said Rule during the period October, 1998 to November, 2000 to their subsidiary units viz. GEETTEAN, M/s. GTN Textiles Ltd., Doubling unit and M/s. GTN Textiles Ltd., Medak Unit and other domestic units. The processed cotton yarn was sent to M/s. GEETTEAN, Doubling unit, Medak unit for the purpose of Knitting, Twisting and Rewinding respectively. The appellant filed their reply to the Show Cause Notice and contended as follows which is recorded in Para 12 of the impugned and the same is extracted herein below : 12. Assessees have furnished reply to the Show Cause Notice vide their letters dated 24-12-2003 and 22-7-2004. Sri A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (b) With reference to Doubling unit, the total qty of 1,23,680.74 kgs was received back after processing and the same were shown in their monthly returns. (c) With reference to Medak Unit and others, out of a qty of 18665.52 Kgs sent, 6309.66 kg was cleared locally after processing on payment of duty, or for export and a qty of 7879 kgs was received back. Out of the balance qty of 4480.44 kgs, 957.80 kg was exported 44 kg was sold as waste and samples, incurred process loss of 79.46 kg, and received back 3399 kg from their Nagpur factory under AR 3A No. 006/2000 and Invoice No. L53, dated 26-4-2000. The detail of reconciliation of quantities sent to the other units, furnished by the assessee is as under : Unit Qty r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anufactured at their Doubling and Winding units. (iv) The Party also has submitted that the procedures followed by them under Rules 156A, 156B 173N of C.E Rules, 1944 were within the knowledge of the department and requested not to invoke penal provisions under Section 11AC or under 173Q of C.E. Rules. 2. The Commissioner considered the question as to whether the unit engaged in the clearance of processed cotton yarn manufactured under Rule 96E of C.E. Rules and the units engaged in the processing of such yarn received qualify as "factory" for the purpose of availing the benefit of duty exemption or otherwise. After quoting Rule 96E, he has held that the other two units to whom the cotton yarn was supplied do not qualify as a "fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... non-confirmation of demands on export, the Counsel has relied on the judgment of Kansal Knitwears v. CCE, Chandigarh - 2001 (136) E.L.T. 467 (Tri. - Del.) wherein it has been held that goods manufactured in one unit of assessee used captively for manufacture of export goods does not attract duty in terms of Board's Circular No. 15/89, dated 6-3-1989 and 105/16/95-CX., dated 2-3-1995 in terms of Rules 12 and 13 of C.E. Rules. He also relied on the judgment of the Apex Court in the case of Thermax Private Ltd. v. CC - 1992 (61) E.L.T. 352 (S.C.) wherein also it has been held that the benefit of Rule 192 of C.E. Rules is available to manufacturers as well as importers once the stipulated nature and use of the goods are satisfied and the user h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rendered in the case of ITW Signode (India) Ltd. v. CCE, Hyderabad by Final Order Nos. 1451 to 1453/2002, dated 13-11-2002 wherein this Bench, on similar facts and circumstances, has held that the demands would be barred by time when the goods are cleared from one unit to another unit of the same assessee and all the details have been declared. He also relied on the judgment rendered in the case of Sri Venkatesa Mills Ltd. v. CCE, Coimbatore - 1996 (87) E.L.T. 170 (Tribunal) wherein permission was granted to transfer cotton yarn to five units for conversion into hanks in terms of Rule 96E and demands raised for larger period was set aside. It is his contention that 95% of the knitted fabric made from the cotton yarn was exported on payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anufacture of cotton fabrics in terms of Rule 96E of C.E. Rules. The Commissioner has not accepted the removal from the appellants factory to their own units as exempted from payment of duty in terms of Rule 96E. After due consideration, we are of the considered opinion that all the units belong to the same manufacturer and such removals under Rule 96E does not require payment of duty. The appellants had been filing declarations and had been following AR-3As procedure. 95% of the goods are also exported. Therefore, in terms of the citations relied and quoted supra, the question of demanding duty in respect of goods, which are exported, does not arise and moreover the goods which are removed to domestic units have been cleared on payment of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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