1983 (8) TMI 271 - AT - Central Excise

Tribunal overturns Collector's decision on excise duty exemption for village industries under Notification No. 116/75.

MEASUREALL ENGG. CO. (P) LTD., COIMBATORE Versus COLLECTOR OF CENTRAL EXCISE, MADRAS

The Tribunal set aside the Appellate Collector's order in a case involving an exemption from excise duty for village industries under Notification No. ... - Issues:1. Interpretation of Notification No. 116/75 regarding exemption from excise duty for village industries.2. Determination of whether the appellant firm qualifies as a village industry.3. Consideration of the certificate issued by the Khadi & Village Industries Commission.4. Review of the order passed by the Appellate Collector and its compliance with the law.Analysis:The case involved a Revision Application under Section 36 of the Central Excises & Salt Act, 1944 against an order passed by the Appellate Collector of Customs & Central Excise, Madras. The Appellants manufactured Ambar Charkhas and spare parts and claimed exemption from excise duty under Notification No. 116/75. The dispute arose when the authorities determined that the firm did not qualify as a village industry and was thus not entitled to the claimed exemption.The Appellate Collector held that the certificate provided by the Khadi & Village Industries Commission did not certify that the products were of a village industry or marketed in accordance with the Act. The Appellants contended that the certificate clearly stated the exemption under Tariff Item No. 68, indicating the genuineness of the products. They argued that the entire stock of Ambar Charkhas was manufactured against orders of the Commission and supplied only to it, meeting the criteria for exemption.The Appellants further highlighted that a sister concern had been granted relief by the Government of India in a similar case. They produced a certificate from the Director of the Khadi & Village Industries Commission to support their claim. The Respondent, however, questioned the competence of the Director to certify the products as specified in the Act.The Tribunal, considering the previous decision of the Government of India accepting a certificate from the Director of the Khadi & Village Industries Commission, set aside the order of the Appellate Collector. The case was referred back to the Appellate Collector for a fresh decision, emphasizing the importance of a proper assessment based on the provisions of the notification and the genuineness of the products as certified by the Commission.