2003 (12) TMI 564 - AT - Central Excise

Manufacturer denied duty exemption under Notification 88/88 for lack of recognition by specific bodies.

The appellant, a detergent washing powder manufacturer, sought duty exemption under Notification 88/88 for products manufactured by recognized rural ... Exemption Issues:1. Duty exemption under Notification 88/88 for detergent washing powder manufacturing.2. Recognition of the appellant's unit by Khadi and Village Industries Commission.3. Validity of subsequent correspondence to establish recognition.4. Commissioner's decision on duty exemption eligibility.Issue 1:The case involved the appellant, a detergent washing powder manufacturer, claiming duty exemption under Notification 88/88. The appellant argued that the exemption applied as the product was manufactured by institutions in rural areas recognized by specific bodies. The Commissioner demanded duty, stating that the appellant's unit did not meet the recognition criteria specified in the notification.Issue 2:The certificate issued by the Khadi and Village Industries Commissioner indicated that the appellant's unit was not recognized as part of the Pratishtan. The appellant contended that recognition was required for institutions, not specific units. However, the format of the certificate showed recognition was unit-specific, leading to the conclusion that the appellant's unit was not accorded recognition.Issue 3:The appellant relied on subsequent correspondence to prove recognition, including a letter from the Gujarat Rajya Khadi Gramudyog Board granting permission for the detergent unit. However, further investigation revealed that the certificates were issued after the duty demand notice, and a letter from the Board indicated no recognition for the appellant's unit.Issue 4:The Commissioner's decision to deny the duty exemption was upheld as the subsequent correspondence did not override the earlier statements indicating lack of recognition. The appellant's admission of non-recognition by State or Central Organizations further supported the denial of the exemption. Ultimately, the appeal was dismissed, affirming the Commissioner's decision on duty exemption eligibility.