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of <h1>Tribunal rules duty-paid clearance not included in value calculation for exempted goods</h1> <h3>SHROFF ENGINEERING LTD. Versus COMMISSIONER OF C. EX., VADODARA</h3> The Tribunal ruled in favor of the appellants, holding that duty-paid clearance of pumps should not be factored into the calculation of the clearance ... SSI Exemption - Value of clearances - Computation of Issues Involved: The issue involves the exemption of duty for submersible pumps and parts thereof, the introduction of Central Excise duty, and the calculation of clearance value for exempted goods.Summary:Exemption of Duty for Submersible Pumps and Parts:The appellants were engaged in manufacturing submersible pumps and parts falling under Chapter 8413.13 of the Central Excise Tariff Act. Submersible pumps were initially exempt from duty until 28-2-2002, while parts were chargeable to duty with the benefit of SSI exemption Notification No. 8/2001-C.E., dt. 1-3-2001.Introduction of Central Excise Duty:Central Excise duty was introduced for pumps from 1-3-2002. Notification No. 8/2001-C.E. was amended by Notification No. 11/2002-C.E., allowing clearance of submersible pumps at a 'nil' rate of duty for the first clearance up to Rs. 10 lakhs between 1-3-2002 and 31-3-2002. The appellant cleared pumps without duty payment up to Rs. 10 lakhs in March 2002.Calculation of Clearance Value for Exempted Goods:The dispute centered on whether the value of duty-paid pumps should be considered in arriving at the exempted clearance value of parts up to Rs. 1.50 crores. The lower authority demanded duty and imposed a penalty, arguing that duty-paid pumps should be included in the total value of clearances to deny exemption benefits.Legal Precedents and Decision:The appellant's advocate referred to the M/s. Ramakrishna Engineering Works case, highlighting the need to consider duty-paid goods for calculating clearances. However, subsequent judgments deviated from this approach, citing the M/s. Khalsa Pulp & Paper Industries case upheld by the Supreme Court. The Tribunal's decision in CCE, Indore v. Neo Era Agro Engineering was also noted.Judgment:The Tribunal found that duty-paid clearance of pumps should not be considered when calculating the clearance value of exempted goods up to Rs. 1.50 crores. Citing settled law on the issue, the impugned order was set aside, and the appeal was allowed with consequential relief to the appellant.
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