2004 (12) TMI 577

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....e receiving cut tobacco under Chapter X Procedure of the Central Excise Rules, 1944, under Notification No. 356/86-C.E., dated 24-6-1986 whereby concessional rate of duty was available to cut tobacco for use in the manufacture of machine rolled cigarettes. A show cause notice was issued to the appellants for demand of duty on the ground that since the weight of the cigarettes contains the weight of tissue paper as well, it was not regular to deduct the weight thereof to find the actual quantity of the cut tobacco consumed as shown by the appellants in the return and was thus, the appellants shown short consumption of tobacco to the extent of the weight of tissue paper contained in the good cigarettes. The Adjudicating authority confirmed th....

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....ht of tissue papers used in the manufacture of cigarettes is unsustainable. The appellants relied upon the decision of the Tribunal in their own case reported as Commissioner of Central Excise, Allahabad v. Tirupati Cigarettes, reported in 2000 (121) E.L.T. 81 (Tribunal) to submit that on similar grounds in respect of the same notification where the demand was set aside by the Commissioner (Appeals), was affirmed by the Tribunal. 5. The contention of the Revenue is that appellants were availing the benefit of notification and were getting the cut tobacco under Chapter X Procedure for use in the manufacture of machine rolled cigarettes. If, the weight of the tissue papers is taken into consideration then the quantity of cut tobacco r....