Custom, Excise & Service Tax Tribunal
Yes vs Represented By : Shri Anand Nainawati, ... on 29 January, 2014
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Zonal Bench, Ahmedabad Appeal No. : E/703-704/2007 Arising out of : OIO No. 09/MP/Vapi/2007 dated 28.02.2007 Passed by : Commissioner of Central Excise & S.T., Vapi For approval and signature : Hon'ble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. H.K. Thakur, Member (Technical) 1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? Yes 3 Whether their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes Appellant (s) : M/s. Filatex India Limited Shri Dhirendra K. Sinha Represented by : Shri Anand Nainawati, Advocate Respondent (s) : Commissioner of Central Excise & S.T., Vapi
Represented by : Shri K. Shivakumar, A.R. CORAM :
Hon'ble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. H.K. Thakur, Member (Technical) Date of Hearing / Decision : 29.01.2014 ORDER No. A/10107-10108/2014 dated 29.01.2014 Per : Mr. H.K. Thakur;
Main appellant M/s. Filatex India Limited is a manufacturer of POY out of duty paid chips and clearing part of its POY to 100% EOU availing exemption under Notification No. 22/2003-CE dated 31.03.2003. Main appellant is also clearing a part of POY manufactured to the job workers, gets the fabrics back and clear the same on payment of duty. In respect of the clearances to 100% EOU, it is the case of the Revenue that NCCD is leviable on the ground that exemption under Notification No. 22/2003-CE does not cover exemption from NCCD. Regarding second issue of clearance of POY to job-worker for manufacture of grey fabrics, it is the case of the appellant that the same is covered by Rule 4(5) (a) of the Cenvat Credit Rules and no duty is payable.
2. Shri Anand Nainawati (Advocate) appearing on behalf of the appellants argued that NCCD is basically a duty of excise and Rule 19 of the Central Excise Rules provides for the removal of excisable goods without payment of duty for further use in the manufacture of export gods. It was thus his case that NCCD can not be demanded in respect of clearance of POY made to 100% EOU for goods which are ultimately exported. He relied upon the order NO. A/2094/WZB/AHD/2011 dated 10.06.2011 passed by this bench in the case of M/s. Modern Petrofils vs. CCE Vadodara (Appeal No. E/2748/2006) and argued that the present appeals are squarely covered by the latest law laid down by this bench. He also relied upon CBEC Circular No. 641/32/2002-CX dated 26.06.2002 on the issue.
3. Shri K. Shivakumar (AR) appearing on behalf of the Revenue defended the orders passed by the adjudicating authority. He also relied upon the judgment of CCE vs. Mahendra Petrochemicals Limited [2010 (256) ELT 473 (Tri. Ahmd.)].
4. Heard both sides and perused the case records. On the issue of export of goods and chargeability of NCCD, CBEC vide Circular No 641/32/2002-CX dated 26.06.2002 has issued following clarification:-
I am directed to refer to Section 129 of the Finance Act, 2001 relating to imposition of National Calamity Contingent Duty (NCCD) and Notification No. 42/2001-C.E. (N.T.), dated 26-6-2001 relating to export of goods without payment of duty under bond and to say that reportedly some of the field formations are issuing demands for collection of National Calamity Contingent Duty (NCCD) on goods exported under bond. The duty demands are issued on the ground that the said notification does not apply to NCCD.
2. Board has examined the matter. Though NCCD is levied under Finance Act, 2001, it is a duty of excise. Notification No. 42/2001-C.E. (N.T.), dated 26-6-2001 issued under Rule 19 of Central Excise Rules, 2001 read with Central Excise Rules, 2002 allows goods to be exported without payment of duty. Further, it is the policy to grant relief form element of domestic taxes on goods, which are exported. Accordingly, it is clarified that no NCCD leviable under Section 129 of Finance Act, 2001 to be paid on the goods exported under bond. No doubt if export does not eventually take place the goods would be subject to all duties of excise including NCCD as applicable.
The above Circular was followed by CBEC 60/1/2006-CX dated 13.01.2006 and 232/16/2004-CX dated 30.01.2006, issued under Section 37B of the Central Excise Act, 1944.
5. With respect to chargeability of NCCD on captive consumption of goods, it has been held in the case of M/s. Modern Petrofils vs. CCE Vadodara (supra) by this bench that NCCD is not leviable. In view of the latest view point held by this bench NCCD is not payable by the appellant. Secondly, CBEC circulars issued on an issue are binding on the departmental officers and can not be challenged in appeal. In view of the above observations appeals filed by the appellants are allowed.
(Operative part of the order pronounced in the Court)
(M.V. Ravindran) (H.K. Thakur)
Member (Judicial) Member (Technical)
.KL
4