1998 (3) TMI 628 - AT - Central Excise

Tribunal grants Century Rayon maintenance exemption, applies benefit retrospectively from 1-3-86

The Tribunal accepted the appeal by M/s. Century Rayon, granting them the benefit under Notification No. 281/86 for goods used in factory repairs. The ... Notification No. 281/86-C.E. Issues:1. Interpretation of Notification No. 281/86 for exemption on goods used for repairs and maintenance.2. Eligibility for benefit of Notification No. 118/75-C.E. for goods used for captive consumption.3. Retrospective effect of Notification No. 281/86-C.E. based on Central Excise Duties (Retrospective Exemption) Bill, 1986.Analysis:1. The case involved two appeals, one by the Revenue and the other by M/s. Century Rayon, against the same order-in-appeal related to Glass Funnels and Glass Jets used by M/s. Century Rayon. The Collector of Central Excise (Appeals) had granted exemption under Notification No. 281/86 for goods used in factory repairs but denied benefit under Notification No. 118/75-C.E. for captive consumption.2. The Tribunal considered the interpretation of Notification No. 281/86, which exempted excisable goods used in a factory for repairs or maintenance from duty. Referring to precedents, the Tribunal emphasized that the size of the workshop was immaterial, and the exemption applied to goods manufactured within a factory for maintenance purposes. The Tribunal rejected the Revenue's argument that the goods were not solely for repairs, stating that the term 'maintenance' had a broad meaning, and the quantity of goods used for maintenance was not limited.3. Regarding the eligibility for benefit under Notification No. 118/75-C.E., which was rescinded with the introduction of a new tariff, the Tribunal noted that M/s. Century Rayon claimed eligibility under Notification No. 281/86 from an earlier date. Citing the Central Excise Duties (Retrospective Exemption) Bill, 1986, the Tribunal highlighted provisions granting retrospective effect to certain notifications issued between specific dates. The Tribunal concluded that Notification No. 281/86 had to be applied from 1-3-86 based on the legal provisions.4. Considering all aspects, the Tribunal accepted the appeal filed by M/s. Century Rayon, allowing the benefit under Notification No. 281/86. Simultaneously, the appeal by the Revenue was rejected. Both appeals were disposed of accordingly, based on the interpretations of the relevant notifications and legal provisions.This detailed analysis of the judgment provides insights into the issues of interpretation of excise duty notifications and retrospective application of exemptions, leading to a clear decision by the Tribunal in favor of M/s. Century Rayon.