TaxTMI 
TaxTMI 
2017 (12) TMI 893
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.... to the Central Excise Tariff Act (CETA), 1985. HDPE granules is the input and the final product is fabrics / sacks. During the process of manufacture of fabric from granules various processes are undertaken namely conversion of granules into films, cutting of films into tapes, hardening of tapes by blowing hot air and winding the tapes / strips into cones and then feeding them into weaving machines for weaving fabrics. The appellant cleared fabrics / sacks claiming SSI exemption under Notification No.8/2003-CE dt. 01.03.2003 as amended. The intermediate products, tapes / strips of plastics are not specified goods under the said notification. It therefore appeared to the department that the said tapes / strips of plastics captively consumed....
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....re of exempted final products [Knitted Garments] cleared/availing SSI exemption is the point of dispute. In a similar situation, the exemption available to cement clinker used in the manufacture of cement, which was cleared without payment of duty availing area-based exemption was the subject-matter of discussion by the Hon'ble Supreme Court in the case of M/s. Ambuja Cements Ltd. (supra). The Supreme Court observed as under:- "12. In the present case, we find that the Clinker is used as input for production of Cement and Cement is exempted from the excise duty. Therefore, by virtue of this proviso insofar as Clinker is concerned, Exemption Notification would not apply. However, the matter does not end here inasmuch as the prov....
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....llowed the exemption in respect of 'Clinker' as claimed above. 15. As per the CESTAT, Rule 6 applies only if some final product is partly exempt and partly dutiable. However, we do not find any such restriction in Rule 6 which contemplates the situation where a manufacturer produces (a) final products which are chargeable to duty, as well as; (b) exempted goods. The Rule does not provide that the same final product should be partly dutiable and partly exempted. On the contrary, this Rule relates to taking of Cenvat credit in respect of 'inputs'. 16. This Rule is not applicable as such in its totality since taking of Cenvat credit is not in issue in these cases. On the other hand, relevance of this Rule is o....
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..../1995-CE. As such, we find that facts are pari materia in both the disputes. Hon'ble Supreme Court on detailed examination of the legal provision to proviso clause of the Notification No.67/1995 gave a finding that the said exemption to the intermediate products is available. 9. On a careful consideration, we note the decision of the Tribunal in M/s.Kunnath Textiles (supra) did not deal with the proviso and the legal implication of the said proviso to the notification as discussed in the decision of the apex court in M/s. Ambuja Cements Ltd. (supra). The Tribunal decided the applicability to Notification No.67/1995-CE to the goods not covered under Notification No.8/2003-CE, being intermediate products. Though, the exemption wa....