Custom, Excise & Service Tax Tribunal
Commissioner Of Central Excise, Nagpur vs Murti Agro Products Ltd on 4 October, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. II APPEAL NO. E/92/06 [Arising out of Order-in- Appeal No. SVS/353/NGP-II/2005 dated 7-10-2005 passed by the Commissioner of Central Excise (Appeals), Nagpur] For approval and signature: Honble Mr Ramesh Nair, Member(Judicial) Honble Mr. C.J. Mathew, Member(Technical) =======================================================
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Commissioner of Central Excise, Nagpur
:
Appellant
VS
Murti Agro Products Ltd
:
Respondent
Appearance
Shri. N.N. Prabhudesai, Superintendent (A.R.) for the Appellants
Shri. Akrit Jain, C.A. for the Respondent
CORAM:
Honble Mr Ramesh Nair, Member(Judicial)
Honble Mr. C.J. Mathew, Member(Technical)
Date of hearing: 4/10/2016
Date of decision: 6/12/2016
ORDER NO.
Per : Ramesh Nair
The fact of the present case is that respondent is engaged in the manufacture and exports of Refined Edible Oil in their solvent extraction plant. The respondent procuring duty free Hexane in terms of Notification No. 43/2001-CE(NT) dated 26-6-2001 read with Central Excise (Removal of goods at Concession rate of duty for manufacture of excisable goods), Rules, 2001. The said Hexane is used in the manufacture of De-oiled Cake(DOC). While manufacturing DOC, soyabean oil is also generated. The case of the department is that Hexane was procured under Notification No. 43/2001-CE(NT) which is not only use for DOC but it is also used for manufacture of oil which is not exported. Accordingly the duty free benefit availed by the respondent is not correct, accordingly duty demand was confirmed. Aggrieved by the Original order, respondent filed appeal before the Commissioner (Appeals), who allowed the appeal and set aside the Order-in-Original, therefore the revenue is before us.
2. Shri. N.N. Prabhudesai, Ld. Superintendent (A.R.) appearing on behalf of the Revenue reiterating the grounds of appeal, submits that it is fact that appellant though manufactured DOC which is exported but also manufactured oil therefore in terms of Notification and concessional duty Rules, 2001 the duty free procurement is available only in respect of the goods which are used for manufacture of exports goods however, in the present case it is used for oil also therefore benefit is not available. He placed reliance on the following judgments:
(a) Orient Weaving Mills (P) Ltd. Vs. Union of India[1978(2)ELT J311(S.C.)]
(b) Zenith Chemicals Vs. Government of India [1994( 73) ELT 533(Del)]
(c) Indian Aluminium Company Ltd Vs. Thane Municipal Corporation [1991(55) ELT 454(S.C.)]
(d) Commissioner of C. Ex. New Delhi Vs. Avis Electronics Pvt Ltd[2000(117) ELT 571(Tri. LB)] In view of the above judgments, he submits that condition of the notification should be scrupulously followed else benefit of the notification cannot be extended.
3. On the other hand, Shri. Akrit Jain, Ld. C.A. appearing on behalf of the respondent submits that respondent is procuring Hexane on the basis of the permission granted following concessional duty rules, 2001. There is no dispute that hexane used for manufacture of DOC which is exported and oil which is generated is in the course of manufacture of DOC. He submits that the present issue is covered by the Tribunal judgments in their own case reported as CCE Vs. Murli Agro Products Ltd [2007(214) ELT 307(Tri. Mumbai)].
4. We have carefully considered the submissions made by both sides.
5. We find that there is no dispute that Hexane indeed used for the manufacture of DOC. DOC and Hexane is provided in the import and export norms. During the manufacture of DOC, soyabeain oil generated unavoidable. The generation of the oil cannot be avoided for the manufacture of DOC. In this fact the Hexane which is procured duty free is used for manufacture of DOC. The notification No. 43/2001 read with concessional duty rules, 2001, the goods for use in manufacture of exports goods are allowed to be procured duty free. Therefore in our considered view, we do not find that there is any violation of notification or rules made thereunder. We further observed that in respondents own in case the issue has been decided in their favour which reproduced below:
The Revenue is aggrieved by the order of the Commissioner of Central Excise (Appeals) who has extended the benefit of exemption in terms of Notification No. 43/2001-C.E. dated 26-6-2001 to Soya De Oil Cake exported by the respondents herein, as, according to the department, Soyabean oil which is an excisable commodity also arises in the manufacture of Soya De Oil Cake out of the imported Hexane and therefore, Soyabean Oil should also have been exported and since it is, not exported, the benefit under the exemption Notification is not available.
2.We have heard both sides. The? Notification requires that the person desiring to export goods without payment of duty under bond may procure inputs for manufacture of such export goods and declare input, output ratio with respect to the export product and the input. There is no stipulation that each and every product that is manufactured during the process has to be exported. Under the input, output norms for Soya De Oil Cake, an exporter is entitled to import duty free 9.20 liters of Hexane for export of one Metric Ton of Soya De Oil Cake. Admittedly, this product was exported. Therefore, the respondents have rightly been held to be eligible to the benefit of the Notification.
3.We, therefore, see no reason to? interfere with the impugned order and accordingly uphold the same and reject the appeal.
From the above decision of this Tribunal, the issue is no more res-integra. We therefore uphold the impugned order and dismiss the Revenues appeal.
(Order pronounced in court on _______________) C.J. Mathew Member (Technical) Ramesh Nair Member (Judicial) sk 2 E/92/06