TaxTMI 
TaxTMI 
2021 (3) TMI 1084
X X X X Extracts X X X X
X X X X Extracts X X X X
.... favour of the respondent-assessee, ignoring the contention of the appellants that the final product being exempt from payment of basic duties, the assessee was not entitled to claim the benefit of the notification dated 09.07.2004 as amended from time to time?" 2. The relevant facts are that the respondent M/S. Dharampal Satyapal Ltd. is a Company registered under the Companies Act and is engaged in the manufacture of zarda, which is a scented tobacco and for which purpose the Company holds a Central Excise registration and necessary licenses. The product manufactured by the assessee falls under Chapter 24 of Central Excise Tariff Act, 2005 under Tariff Sub Heading 2403-99-30. The Government of India had issued an exemption Notification dated 21.01.2004 granting exemption from the whole of the duties of excise leviable under Central Excise Tariff Act and other duties under other fiscal statutes on all goods falling under various sub-headings including the sub-heading under which the assessee's product fell. This was subject to certain conditions and was made available in respect of units located in the States of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland or T....
X X X X Extracts X X X X
X X X X Extracts X X X X
....l Excise, Shillong passed an order on 28.09.2007 and confirmed the demands as per the show cause notices and imposed a matching penalty of Rs. 7.80 Crores (rounded off). He referred to the definition of term "exempted goods" contained in Rule 2(e) of the CENVAT Credit Rules and came to the conclusion that the product of the assessee would fall within the said definition. He thereupon proceeded to apply Rule 6(1) of the said Rules in order to come to the conclusion that the assessee had wrongly availed the CENVAT credit which must be reversed or recovered with penalty. 6. The assessee carried the matter in Appeal filing separate Appeals for different assessment periods. These Appeals were consolidated and allowed by the Tribunal by the common impugned judgment dated 17.07.2018. The department has thereupon filed these Appeals. 7. Appearing for the department, learned counsel Mr. Paramartha Datta submitted that the final product cleared by the assessee was exempt from payment of duty. In terms of Rule 6(1) of CENVAT Credit Rules, the assessee therefore could not have availed of CENVAT credit on raw material and capital goods utilized for manufacture of the said product. Since the a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....text, the question whether the final product manufactured and cleared by the assessee can be stated to be an exempt goods becomes relevant. 11. Term exempted goods is defined in Rule 2 (d) of the said Rules as under: 2.(d) "exempted goods" means excisable goods which are exempt from the whole of the duty of excise leviable thereon, and includes goods which are chargeable to "Nil" rate of duty." 12. As per this definition thus "exempted goods" means excisable goods which are exempt from whole of the duty of excise and includes goods which are chargeable to "Nil" rate of duty. In the context of these statutory provisions, the Tribunal was of the opinion that the exemption from payment of excise duty and other duties under the Notification dated 21.01.2004 as amended by later Notification, was not an unconditional exemption. It was also observed that though the basic duty of excise was exempt on the final product, other duties such as National Calamity Contingent duty and Education Cess were applicable. In the opinion of the Tribunal term exempted goods for the purpose of Rule 6(1) would cover only those goods which are exempt from all kinds of excise duties. 13. Before we....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Industry of the State in which the investment is made, and shall have to prove to the satisfaction of the said Committee that the investment has been made for the purpose specified in condition (B); (E). if the Committee referred to in condition (D) is satisfied that the investment as specified in condition (B), has been made, it shall issue a certificate to this effect to the manufacturer within a period of three weeks after the expiry of the one month referred to in condition (D), which shall be produced by the manufacturer, within a period of two weeks from the date of issue of such certificate, to the jurisdictional Central Excise Officer; (F). the investment made under this notification shall not be allowed to be withdrawn before the expiry of ten years from the date on which the investment is made except in a case where the investment withdrawn is reinvested in the same manner as specified in this notification, in any one of the States mentioned in condition (A): Provided that if the investment made under this notification is withdrawn before the expiry of ten years and is not reinvested as mentioned above, the duty which is equal to the amount so withdrawn and not so ....