Captive-consumption exemption applies to NCCD when no distinct marketable intermediate product is shown.

NCCD under Section 136 of the Finance Act, 2001 is treated as duty of excise for exemption purposes, so Central Excise exemptions can apply to it. The dispute concerned whether a distinct, marketable dumper chassis emerged as an intermediate product and whether captive-consumption exemption under Notification No. 67/95-CE could be denied because NCCD was not expressly named. On the facts, no separate chassis was established; the goods retained the essential character of the final dumper. The Tribunal accordingly applied the notification to the NCCD levy and set aside the demand, interest, and penalties.

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Issues: Whether National Calamity Contingent Duty was payable on the alleged dumper chassis used captively in the manufacture of dumper trucks and whether the benefit of Notification No. 67/95-CE extended to such NCCD levy.

Analysis: The levy under Section 136 of the Finance Act, 2001 is collected as duty of excise and the provisions relating to exemption under the Central Excise law apply to it. The dispute turned on whether the intermediate product alleged by the department was an identifiable and marketable chassis, and, in any event, whether the exemption for goods captively consumed under Notification No. 67/95-CE could be denied merely because NCCD was not named expressly. On the facts, the record did not establish emergence of a distinct chassis as an intermediate product; the goods were treated as having the essential character of the final dumper. The Tribunal also followed the line of decisions holding that NCCD, being a duty of excise for this purpose, is covered by the exemption notification.

Conclusion: The demand of NCCD was not sustainable. The exemption under Notification No. 67/95-CE was held applicable, and the demand, interest, and penalties were set aside.

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