Custom, Excise & Service Tax Tribunal
The Bombay Dyeing &Amp; Mfg. Co. Ltd. vs Cce Raigad on 26 September, 2018
1
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE
TRIBUNAL
WEST ZONAL BENCH AT MUMBAI
COURT NO. I
Appeal No. E/222/2011
(Arising out of Order-in-Appeal No. YDB/800/RGD/2010 dated
15.11.2010 passed by the Commissioner of Central Excise
(Appeals), Mumbai).
M/s Bombay Dyeing & Mfg. Co. Ltd. Appellant
Vs.
Commissioner of Central Excise, Raigad Respondent
Appearance:
Shri Sachin Chitnis, Advocate for Appellant Shri Sanjay Hasija, Supdt. (AR) for Respondent CORAM:
HON'BLE DR. D.M. MISRA, MEMBER (JUDICIAL) HON'BLE MR. S. SRIVASTAVA, MEMBER (TECHNICAL) Date of Hearing: 26.09.2018 Date of Decision: 26.09.2018 ORDER NO. A/87573 / 2018 Per: Dr. D.M. Misra Heard both sides.
2. This is an appeal filed against Order-in-Appeal No. YDB/800/RGD/2010 dated 15.11.2010 passed by the Commissioner of Central Excise (Appeals), Mumbai. 2
3. Briefly stated the facts of the case are that the appellants are engaged in manufacture of Dimethyl Terephthalate (DMT) falling under Chapter 29 of the Central Excise Tariff Act, 1985. During the course of manufacture of DMT, the residue which is obtained was claimed as non-excisable. Alleging that DMT residue is a marketable commodity, show-cause notices were issued periodically demanding duty on the quantity of the residue used in their boiler for generation of steam during the relevant period i.e. March, 2005 to June, 2007. On adjudication, the demands were confirmed with interest and penalty. Aggrieved by the said order, appeal was filed before the learned Commissioner (Appeals), who in turn, rejected their appeal. Hence, the present appeal.
4. The short issue involved in the present appeal is whether residue which emerges during the course of manufacture of DMT is excisable and whether the appellants are entitled to the benefit of the Notification No. 67/95-CE dated 16.3.1995 as amended. We find that this Tribunal in the appellant's own case, reported in 2011 (268) ELT 401 (Tri-Mum), considering the issue observed as follows: -
"20. We have observed that the adjudicating authority has arrived at the decision that the product in question is marketable (which is not admitted by the appellant), but thereafter the adjudicating authority has failed to do his duties under the act i.e., whether the appellant is entitled to the benefit of the notification No. 217/86 upto 15-3-1995 and Notification No. 67/95, dated 16-3-95 thereafter.
21. We have gone through the notification, which grant exemption for captive use. In this case, it is no doubt that DMT-Residue has been used by the appellants in their own factory for generation of steam in boiler for further manufacturing of the final products viz., DMT. This fact has not been considered by the adjudicating authority and it is a question of law whether the appellants are entitled for the benefit of above said notification or not. It can be raised at any stage of proceedings. Hence, after going through the facts of this case, we hold 3 that the appellants are entitled for the benefit of the above said notifications for the period with effect from 20-3-90 till 2006. We also found the force in the contention of the Ld. Advocate that the credit of Modvat duty paid on DMT-Residue was available based on Rule 57A(4) read with Rule 57B(4) and such credit could have been utilized for payment of duty on DMT. There is a specific mention of eligibility of credit on inputs used for manufacture of final products or for any other purpose, within the factory hence it is a revenue neutral situation.
22. We also relied on the decision of the Hon'ble Apex Court in the case of Share Medical Care v. UOI, reported in 2007 (209) E.L.T. 321 (S.C.), wherein it was held that even if the assessee does not claim the benefit under a particular notification at initial stage, he is not debarred, prohibited or estopped from claiming such benefit at a later stage. We also relied upon the Hon'ble Supreme Court judgment in the case of Devangere Cotton Mills v. CCE, Belgaum, reported in 2006 (198) E.L.T. 482 (S.C.), wherein it was held by the Apex Court that Rule 10 of CESTAT Procedure Rules, 1982 is widely framed to allow the Tribunal to decide appeal even on grounds not taken in memorandum of appeal and when Tribunal itself considering the issue on a contested hearing, the appellants cannot be shut out from pleading its case on same basis.
23. In view of the above discussion, we find that it is the duty of the adjudicating authority itself to ascertain the correct duty liability by classifying the goods correctly by ascertaining correct assessable value and to give the benefit of the exemption notifications mentioned above to the appellants in this case, which the adjudicating authority has failed to do so.
24. As discussed herein above that the appellants are entitled for the benefit of exemption Notification No. 217/86 & 67/95." We do not find any justifiable reason to deviate from the aforesaid observation of the Tribunal.
5. In the result, following the aforesaid precedent, impugned order is set aside and the appeal is allowed.
(Operative portion of the order pronounced in Court) (S. Srivastava) (Dr. D.M. Misra) Member (Technical) Member (Judicial) Sinha