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of <h1>Circles made of brass fall under S.No.200 of Notification 3/2001 and qualify for nil rate; exemptions read by plain language</h1> SC held that circles manufactured from brass fall within S.No.200 of Notification 3/2001 and are entitled to nil rate of duty. The Court emphasized that ... Claims exemption under S.No.200 of Not. 3/2001 - Classification of Trimmed or Untrimmed Circles of Brass - entitlement to claim benefit of exemption under S.No.200 - HELD THAT:- In this case, circles manufactured by the assessee are made from brass. Therefore, in our view, S.No.200 would apply and the assessee would be entitled to claim nil rate of duty under the said Notification. We may also point out at this stage that it is well settled position in law that exemption Notification has to be read strictly. A notification of exemption has to be interpreted in terms of its language. Where the language is plain and clear, effect must be given to it. While interpreting the exemption notification, one cannot go by rules of interpretation applicable to cases of classification under the Tariff. Tariff items in certain cases are required to be interpreted in cases of classification disputes in terms of HSN, which is the basis of the Tariff. In this case, we are not concerned with interpretation of Tariff. In fact, as stated above, the product in question falls under Chapter Heading 74.09. It is the dichotomy which is introduced by the exemption Notification which needs to be interpreted. Items made from copper attract duty at the rate of Rs.3500 PMT whereas circles made from brass attract nil rate of duty. As stated above, in this case, the Department has not disputed the fact that the circles were manufactured by the assessee from brass. This is expressly recorded in the findings given by the Tribunal. Consequently, the Civil Appeal filed by the Department stands dismissed Issues:1. Interpretation of exemption Notification No.3/2001-CE, dated 1.3.2001 regarding the entitlement to claim benefit of exemption under S.No.200.2. Determination of whether trimmed or untrimmed circles of brass fall under S.No.200 or S.No.201 of the Notification.3. Analysis of the dichotomy created between trimmed/untrimmed sheets of copper and all goods other than trimmed/untrimmed circles of copper under Chapter Heading 74.09 in the exemption Notification.Issue 1: Interpretation of Exemption Notification:The primary issue in this case was the interpretation of exemption Notification No.3/2001-CE, dated 1.3.2001, specifically regarding the entitlement of the respondent-assessee to claim the benefit of exemption under S.No.200. The dispute revolved around whether the goods in question fell under S.No.200, attracting a nil rate of duty, or under S.No.201, where the duty rate was Rs.3500 PMT.Issue 2: Classification of Trimmed or Untrimmed Circles of Brass:Another key issue was the classification of trimmed or untrimmed circles of brass manufactured by the assessee. The Department argued that brass, being an alloy of copper/zinc, should be classified under S.No.201 of the Notification, thereby subjecting the assessee to duty at the rate of Rs.3500 PMT. The contention was whether circles made from brass should be considered under S.No.200 or S.No.201.Issue 3: Dichotomy in the Exemption Notification:The judgment delved into the dichotomy created within the exemption Notification concerning goods falling under Chapter Heading 74.09. While both S.No.200 and S.No.201 pertained to Chapter Heading 74.09, a clear distinction was made between trimmed/untrimmed sheets of copper and all goods other than trimmed/untrimmed circles of copper intended for use in the manufacture of utensils. The analysis focused on interpreting this dichotomy to determine the applicability of the nil rate of duty under S.No.200.The Supreme Court analyzed the relevant provisions of the Notification and emphasized the need for strict interpretation of exemption Notifications based on their language. It was highlighted that the exemption Notification specifically differentiated between goods made from copper and those made from brass, with different duty rates applicable. The Court clarified that since the circles in question were manufactured from brass, falling under Chapter Heading 74.09, they should be considered under S.No.200, entitling the assessee to claim the nil rate of duty.In conclusion, the Court found no infirmity in the Tribunal's decision and dismissed the Civil Appeal filed by the Department, with no order as to costs. Additionally, other related appeals were also dismissed in light of the judgment passed in the main Civil Appeal.
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