2024 (5) TMI 365 - AT - Central Excise

CESTAT grants SSI exemption under N/N. 8/2003-CE, allows refund claim filed within one month of dropped proceedings

M/s. Wintek Enterprises Versus Commissioner of Central Excise, Kolkata-II

M/s. Wintek Enterprises Versus Commissioner of Central Excise, Kolkata-II - TMI Issues involved: Denial of benefit of exemption Notification No.8/2003-CE dated 01.03.2003, rejection of refund claim as barred by limitation.Denial of benefit of exemption Notification:The appellant, engaged in manufacturing and trading activities, faced a show cause notice for central excise duty demand of Rs.13,42,204, denying the benefit of exemption Notification No.8/2003-CE. The appellant contested, stating they only manufactured goods worth Rs.43,34,718, with the rest being trading sales. The Ld.Commissioner(Appeals) remanded the matter to verify the purchases made by the appellant from the open market. After dropping proceedings, the Revenue challenged, leading to the Ld.Commissioner(Appeals) confirming the demand. The appellant appealed, arguing they had sufficient evidence of manufacturing and trading activities, seeking a refund claim of Rs.10.00 Lakhs deposited during investigation.Rejection of refund claim as barred by limitation:The appellant's refund claim was rejected as time-barred. The appellant contended that as per records and audited balance sheet, they had manufactured goods worth Rs.43,34,716 and purchased goods amounting to Rs.1,38,84,089, cleared as bought-out items. The appellant sought to set aside the Ld.Commissioner(Appeals) order, claiming the evidence was contrary to the facts, and the refund claim should be allowed within one year of dropping proceedings.The Tribunal found that the appellant's initial statement and recovered documents supported their claim of manufacturing and trading activities. The Ld.Commissioner(Appeals) failed to consider the evidence and wrongly held the appellant did not provide proof. The Tribunal set aside the Ld.Commissioner(Appeals) order, affirming the dropping of proceedings against the appellant. Consequently, the appellant was entitled to the benefit of SSI exemption Notification No.8/2003-CE, and no duty was payable. The appeal was allowed, and the refund claim, filed within one month of dropping proceedings, was deemed within time and granted based on relevant legal precedent.Therefore, both appeals were disposed of in favor of the appellant, setting aside the impugned orders and allowing the refund claim in accordance with the decision of the Hon'ble Madras High Court.