2023 (12) TMI 847 - HC - Central Excise

Matter adjourned to December 15th after counsel seeks more time for burden of proof case

COMMISSIONERATE OF CENTRAL EXCISE, HALDIA COMMISSIONERATE Versus M/s. TAMRALIPTA CO-OPERATIVE SPINNING MILLS LIMITED

The HC adjourned the matter to 15th December, 2023 at 10:30 A.M. for further hearing after appellant's counsel requested additional time for preparation. ... Burden to prove - failure to appreciate that onus lay on the respondent to prove that the conditions imposed in Notification Nos. 4/97-CE, 5/98-CE, 5/99-CE, 6/00-CE were satisfied in the instant case - failure to discharge the onus of proving that the two conditions mentioned in the said Notifications - role of the apex bodies was in the nature of selling or commission agents and not that of direct purchasers of the said goods from the Respondent. HELD THAT:- In the midst of argument, learned counsel for the appellant prayed that the matter may be taken up tomorrow so that he may prepare the case thoroughly. List the matter on 15th December, 2023 at 10:30 A.M. for further hearing. Issues Involved:1. Onus of proving conditions for exemption.2. Compliance with conditions for exemption.3. Role of apex bodies as selling or commission agents.Summary:Issue 1: Onus of Proving Conditions for ExemptionThe primary issue was whether the Tribunal failed to appreciate that the onus lay on the respondent to prove that the conditions imposed in Notification Nos. 4/97-CE, 5/98-CE, and 6/00-CE were satisfied. The Tribunal held that the respondent/assessee produced the required certificates from the authorized officers of the Handloom Co-Operative Society, NHDC, or State Government Handloom Development Corporation, ensuring that the yarn was to be used only on handloom. The Tribunal found that the respondent had complied with the conditions and that there was no evidence to the contrary.Issue 2: Compliance with Conditions for ExemptionThe Tribunal examined whether the respondent had failed to discharge the onus of proving that the two conditions mentioned in the notifications were satisfied. The Tribunal found that the yarn was sold to Tantuja and Tantusree, apex bodies established by the State Government, and payments were made by cheque from their own bank accounts. The Tribunal noted that the requisite certificates were produced, and there was no evidence to show that the yarn was used elsewhere. The Tribunal concluded that the respondent had complied with the conditions for exemption.Issue 3: Role of Apex Bodies as Selling or Commission AgentsThe Tribunal addressed whether it should have inferred from the facts on record that the role of the apex bodies was in the nature of selling or commission agents and not direct purchasers. The Tribunal found that the goods were purchased by the apex bodies for further distribution to traders, who then sold them to the ultimate handloom weavers. The Tribunal concluded that the presence of traders in the meetings and their payments to the apex bodies did not establish that the goods were sold directly to the traders. The Tribunal held that the role of the apex bodies was to ensure proper distribution of the yarn to the handloom sector.Conclusion:The Tribunal allowed the appeal of the respondent/assessee, finding that the conditions for exemption were satisfied and that the role of the apex bodies was not that of selling or commission agents. The Tribunal set aside the penalties and duties imposed by the Commissioner of Central Excise.Further Proceedings:The revenue filed the present appeal against the Tribunal's order. The matter was listed for further hearing on 15th December 2023.