2007 (2) TMI 420

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....er of nylon filament yarn. They twist and turn the nylon filament yarn so procured and obtain nylon twine which is further used in the manufacture of their final product viz. nylon fishing nets. The present dispute is regarding demand of duty on the intermediate product i.e. nylon twine which was classified by them under Chapter Heading 5607.90 and was cleared by them under full exemption of duty under Notification No. 6/2002 dated 1-3-2002 (Sr. No. 142 of the table). This exemption was subject to the condition that appropriate duty was paid on the base yarn and the manufacturer does not have the facility to manufacture base yarn. Since filament yarn of 210 deniers was fully exempted from duty they obviously were not taking any credit of th....

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....arn falling under Chapter Heading 5402, 5403 when procured from outside and subjected to any process other than texturising by manufacturer who does not have a facility in factory (including plant and equipment) for manufacture of yarn or texturised yarn including twisted and draw twisted of heading 5402, 5403 provided that nothing contained in the Notification shall apply to the goods in respect of which credit of duty on inputs or capital goods has been taken under the provision of Cenvat Credit Rules, 2002. It was submitted that since nylon monofilament yarn procured from outside was exempted from duty, the question of taking any credit does not arise and since they do not have any facility in their factory for manufacture of yarn or tex....

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....he same the extended period cannot be invoked. 4. Learned D.R. however reiterates the finding of the Commissioner and submits that the applicant should have made a specific declaration that the denierage of their yarn is less than 9000 instead of declaring denierage of single yarn and leaving it to the department to calculate the exact denierage of multi filament yarn and further that such declaration should be made in a proper format and not in RT 12 returns. 5. We have considered the submissions. We find that prima facie the exemption under Notification 30/04 cannot be denied to the applicant as there is no requirement in the notification that the inputs should have discharged some duty before being used for the manufactur....