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of <h1>Appellate Tribunal allows duty exemption: Strict interpretation favors appellants</h1> <h3>ABHISHEK STEELS LTD. Versus COMMISSIONER OF C. EX., HYDERABAD</h3> ABHISHEK STEELS LTD. Versus COMMISSIONER OF C. EX., HYDERABAD - 2001 (131) E.L.T. 457 (Tri. - Chennai) Issues:Appeal against duty demand and penalty imposition based on Notification No. 50/97-C.E. and Notification No. 57/97-C.E.Detailed Analysis:1. Background and Duty Demand:The appeals were filed against the orders passed by the Commissioner of Central Excise, Hyderabad-I, concerning the duty payable by M/s. Abishek Steels Ltd. for manufacturing M.S. Channels, M.S. Angles, and M.S. Joints falling under Chapter Sub-heading No. 7216.10 of the Central Excise Tariff Act, 1985. The Commissioner determined the duty payable based on the annual production capacity of the appellants' re-rolling machine under Rule 96ZP(3) of the Central Excise Rules, 1944.2. Applicability of Exemption Notifications:The appellants contended that they were entitled to the concession under Notification No. 50/97-C.E. as amended by Notification No. 57/97-C.E. and paid duty at the rate of Rs. 300/- per MT for goods manufactured before 1-9-1997 but cleared after that date. However, the Central Excise authorities disapproved, leading to demand notices for differential duty. The appellants argued that they satisfied the conditions of the notifications and should not be excluded from the benefit.3. Contentions and Interpretation of Notifications:The appellants argued that the notifications did not restrict their applicability only to units covered under Section 3A of the Central Excise Act, 1944. On the other hand, the Revenue contended that the notifications pertained to the capacity of production and the compounded levy scheme. The Commissioner's view was that the exemption notifications applied only to units under Section 3A.4. Exemption Notification Analysis:The Tribunal analyzed Notification No. 50/97-C.E., which exempts goods produced before 1-8-1997 and cleared after that date from hot re-rolling mills. The Tribunal observed that the notification did not link the exemption to the compounded levy scheme or Section 3A, and strict interpretation was required. As the scheme came into force on 1-9-1997, restricting the exemption to units under the scheme would be illogical.5. Decision and Conclusion:The Tribunal found no justification to deny the exemptions to the appellants based on the language and scope of Notification No. 50/97-C.E. Therefore, the appeals were allowed, setting aside the orders passed by the lower authority. The operative part of the order was announced on 11-1-2001.This detailed analysis outlines the issues, arguments, interpretations of relevant notifications, and the final decision of the Appellate Tribunal CEGAT, Chennai in the case.
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