M/S. Bhushan Steel & Strips Ltd vs Commissioner Of Central Excise

[Arising out of Order-in-Appeal No. 60-CE/GZB/2006 dated 24.05.2006 passed by the Commissioner of Central Excise, Ghaziabad].

For approval and signature:

Hon'ble Shri Ashok Jindal, Member (Judicial)

Hon'ble Shri B. Ravichandran, Member (Technical)

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether Their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

M/s. Bhushan Steel & Strips Ltd. Appellants

Vs.

Commissioner of Central Excise Respondent

(Appeals) Ghaziabad

Appearance:

Shri Rajesh Chibber, Advocate for the Appellants

Shri R K Grover, DR for the Respondent

CORAM:

Hon'ble Shri Ashok Jindal, Member (Judicial)

Hon'ble Mr. B Ravichandran, Member (Technical)

Date of Hearing /decision: 19.08.2015

FINAL ORDER NO. 52739/2015-EX(DB)

Per Ashok Jindal:

The appellant is in appeal against the impugned order demanding duty on intermediate product.

2. The facts of the case are that the appellant is manufacturer of galvanized corrugated sheets. To manufacture the final product, the appellant procures HR coils which are converted into CR coils, thereafter process of galvanization took place. Thereafter, the process of corrugation took place and final product is cleared on payment of duty. The appellant effected certain clearances to State of Gujarat in Kutch area and availed benefit of Notification No. 2/01 dated 27.1.2001 wherein the clearances made to Kutch was entitled for exemption from duty. Initially, show cause notice was issued to the appellant to deny the benefit of notification as the appellant has not completed the conditions of the notification and it was also alleged that appellant is required to pay duty on intermediate product i.e. galvanized sheets as the final product is exempted from duty. The adjudication was done by adjudicating authority allowing the benefit of notification on verification of the documents but asked the appellant to pay the duty on intermediate product, i.e. galvanized sheets as the final product sold by the appellant is exempt from payment of duty. Learned Commissioner (Appeals) confirmed the order of adjudicating authority. Aggrieved from the said order, appellants is before us.

3. Learned Counsel for the appellant submits that although the appellant has availed exemption under notification No. 2/2001 dated 27.1.2001 but on their final product which is exempt from payment of duty, they have paid 8% of value of said goods as per Rule 6(3) of Cenvat Credit Rules, 2004. Therefore, they are not required to pay duty on intermediate product.

4. On the other hand, learned AR submits that as the final product is exempt from payment of duty, therefore, the appellant is not entitled to claim the benefit of exemption notification No. 67/95 dated 16.3.95. Therefore, they are not entitled to take benefit of said notification. In these circumstances, the appellant is required to pay duty at the stage of galvanization of sheets manufactured by the appellant.

5. Heard the parties. Considered the submissions.

6. In this case, the facts which are not in dispute are that process of manufacturing includes conversion of HR coils into CR coils and thereafter galvanization. After galvanizing, the corrugation took place. The appellant has cleared the said goods on payment of duty by claiming exemption under notification No. 67/95. In rare cases, the goods were cleared to Kutch area by availing the benefit of notification No. 02/2001 dated 27.1.2001 without payment of duty. The admitted position is that appellant is not entitled to avail the benefit of exemption notification No. 67/95. But in this case, the appellant is paying 8% of value of exempted goods cleared by them in terms of Rule 6(3) of the Cenvat Credit Rules, 2004. In these circumstances, we hold that appellant is entitled to claim the benefit of exemption notification No. 67/95. Therefore, the appellant is not required to pay duty at the stage of galvanizing of sheets.

7. With these terms, we do not find any merit in the impugned order, the same is set aside. Appeal is allowed with consequential relief, if any.

(Dictated and pronounced in the open court )

( Ashok Jindal ) Member(Judicial)

( B Ravichandran )

Member(Technical)

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