M/S. Jansons Clothing vs Cce, Salem

Customs Excise and Service Tax Appellate Tribunal8 April 2015

CitationAppeal No.394/2004-CE (SLM) dated 27.10.2004 passed by the Commissioner of Central Excise

Ratio decidendi

The rule this decision rests on

The principle on which the Tribunal allowed the assessee's appeal is that a conditional exemption under Notification No. 43/2001-CE, which permits clearance of duty-free raw materials for use in manufacturing goods for export, is satisfied where the goods manufactured from those materials are in fact exported, and the notification does not require that the export be effected by the assessee manufacturer itself, the spirit of the notification being the export of goods manufactured from duty-free inputs irrespective of the person who exports them. Where the excise authority has permitted the clearance of duty-free raw materials to a processor, and proof of export of the finished goods has been furnished, the assessee cannot be denied the benefit of the exemption merely because the exporter is a third party rather than the assessee.

Written by Miss Lucy from the judgment below, not taken from a headnote.

Judgment

As delivered

IN THE CUSTOMS, EXCISE & SERVICE TAXAPPELLATE TRIBUNALSOUTH ZONAL BENCH, CHENNAIE/50/2005 (By Assessee)E/58/2005 (By Department)

(Arising out of Order-in-Appeal No.394/2004-CE (SLM) dated 27.10.2004 passed by the Commissioner of Central Excise (Appeals), Salem)

M/s. Jansons Clothing CCE, Salem Appellants

Vs.

CCE, Salem M/s. Jansons Clothing Respondents

Appearance

Shri Raghaan Ramabhadran, Advocate for the Appellant Shri M. Rammohan Rao, DC (AR) for the Respondent

CORAM

Honble Shri D.N. Panda, Judicial Member Honble Shri R. Periasami, Technical Member

Date of Hearing / Decision: 08.04.2015

Final Order No. 40400 & 40401/2015

Per D.N. Panda

Learned counsel submits that the raw materials were procured domestically duty-free. However, with the permission of the excise authority in terms of letter dated 15.2.2002, the appellant was allowed to clear the raw materials for further processing by an exporter namely M/s. C. Renuka Soft-X Towels, Theni 625 531. The condition of the permission was that the appellant has to fulfill condition stipulated in the Notification No. 43/2001 dated 26.6.2001 and furnish proof of export. There is no dispute of submission of the proof of export by the appellant. The appellant also satisfied the authority on 9.12.2002 providing the proof of export (Ref. 103 to 106 of appeal folder).

2. On the aforesaid scenario, Revenues allegation is that the appellant itself did not export the goods.

3. Controversy in this appeal is reduced to the point as to whether notification has to be interpreted to mean that export has to be made by the appellant only or the goods are to be exported. The spirit of the notification being to export the goods manufactured using duty free raw material irrespective of the person who exported the same there should not be controversy to bring the appellant to the jaws of the levy. Added to this, the appellant was granted permission for clearing the duty free raw material for use in export of the finished goods supported by proof of export, appellant succeeds. Appeal is allowed accordingly.

4. In view of the above decision, Departments appeal is dismissed waiving levy of penalty.

(Dictated and pronounced in open court)

(R. PERIASAMI) (D.N. Panda) Technical Member Judicial Member

Rex

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