2005 (2) TMI 160 - SCH - Central Excise

Supreme Court upholds denial of benefit for canvas cloth classification, remands for small scale industry exemption eligibility.

The Supreme Court dismissed the appeal on the classification of canvas cloth, denying the benefit of a specific notification. The matter was remanded to ... Tarpaulin Cloth - whether the canvas cloth manufactured by the respondent-assessee out of which tarpaulins are stitched has been dealt with by the Tribunal by treating the canvas cloth as classifiable under Tariff heading 52.06 - Held that:- Tribunal has denied the benefit of Notification No. 65/87-CE, dated 1-2-87 in respect of the tarpaulins which were manufactured by the appellant out of the canvas cloth on the grouad that the same had in fact, been manufactured by the use of power. The Tribunal has also held that the penalty was imposable on the respondent. However, the Tribunal has remanded the matter back for examining whether the respondent is entitled to the benefit of exemption as a small scale industry. Since the quantum of duty would have to be redetermined depending upon the outcome of this question, the question of imposition of penalty was also left to be decided by the Adjudicating Authority. The respondent was directed to submit the proof to the Adjudicating Authority for availing the SSI exemption within a period of one month from the date of the receipt of the order of the Tribunal - Decided in favour of Revenue. The Supreme Court dismissed the appeal regarding the classification of canvas cloth used for tarpaulins and denied the benefit of a specific notification. The Tribunal remanded the matter to determine if the respondent qualifies for a small scale industry exemption. The Court upheld the Tribunal's decision without interference.