2005 (3) TMI 672

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....on the yarn and tops manufactured. The goods are captively consumed without filing CL/Declaration for the same, as required under Rule 173B of Central Excise Rules, 1944, with deliberate intention to evade payment of duty and wilful suppression of the facts is alleged to fraudulently avail the exemption under Notification No. 67/95 by the show cause notice issued to Commissioner vide his order discharged the notice on the grounds. (a)     Section 3(1) of Additional Duties of Excise (T & TA) Act, 1978 fixes the measure of levy and says that this will be equal to 15% of fatal amount chargeable as excise duty under Central Excise Act, 1944 read with any notification issued in relation to the duty so chargeable. While calcu....

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....in respect of any goods. From above, it follows that if basic excise duty is exempted then addl. duty will also be nil. (d)     Notifications issued under Section 5A of the Central Excise Act can exempt duties leviable under Schedule of Central Excise Act only and no other Act. Revenue was satisfied with this order and found the same to be not correct to be on the following grounds : (a)     The Hon'ble Supreme Court in the case of M/s. Modi Rubber Ltd., [1986 (25) E.L.T. 849] held that an exemption notification issued under Rule 8(1) of the Central Excise Rules, 1944 (Now Section 5A does not mean an exemption from Special Excise duty and Additional Excise duty unless such exemption notification al....

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....cise under Central Excise Act, 1944 read with any notification for the time being in force issued by Central Government in relation to the duty so chargeable (not being a notification providing for any exemption for giving credit with respect to, or reduction of duty of excise under the said Act or the additional duty under Section 3 of the Customs Tariff Act, 1975 already paid on raw materials used in the production or manufacture of such goods) are assessed to duty, there shall be levied and collected a duty on excise equal to fifteen per cent of the total amount so chargeable on such goods." This section fixes the measure of this levy and says that this will be equal to 15% of the total amount chargeable as excise duty under Central Exc....