AI Drafter 
TaxTMI 
TaxTMI 
2024 (10) TMI 805
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.... that the assesse-appellant is inter alia, engaged in the manufacture of Polyester Partially Oriented Yarn (POY), Texturised Yarn, Draw Texturised Yarn, Grey Fabrics and Knitted Fabrics. The investigation conducted in subject matter revealed that during the period from 06.03.3014 to 22.03.2015, the assesse had manufactured and cleared the Texturised Yarn and Knitted Fabrics without payment of the Central Excise Duty leviable thereon. Further it was seen that appellant has been manufacturing texturised yarn leading to the production of grey and knitted fabrics on different floors of the same registered premises under one roof. During the course of investigation it was found that the appellant had on 21.02.2014 intimated the Jurisdictional officers to revise the declared ground plan of the factory building. Appellant claimed the exemption under Notification No. 30/2004-CE dated 09.07.2004 on clearances of texturised yarn and knitted fabrics. As per revenue the said notification is conditional and the exemption from payment of duty is applicable only when yarn is procured from outside. The assesse's contention is that they are exempted from payment of duty under Notification No.30/200....
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....ld not have been invoked by issuing this SCN in 2019. 2.2 He further submits that the Panchnama dated 18.03.2015 and the statement of the Director of the Appellant dated 07.01.2016 as drawn during the investigation, clearly records that there are 3 separate buildings in the premises, which are undertaking separate manufacturing activities entirely. However in direct contradiction of this panchnama and statement of investigation the SCN wrongly recorded that the 3 units are located at one place only. Even the specific letter dtd. 26.11.2019 as written by the department, on a specific query of the Assistant Commissioner, clearly noted that all 3 units are separately located and unit 2 & 3, which are manufacturing and clearing Texturized yarn and knitted fabrics, do not have any facility to make POY at all nor have they claimed any credit of the duty paid on such POY used by them. 2.3 He also submits that this issue is also squarely covered by the Judgment and decision of tribunal in the case of Bhilosa Industries Pvt. Ltd. Vs. CCE, Surat reported in 2105(317)283 (Tri,- Ahmd). 2.4 He argued that even otherwise the unit No.2 clearing texturized yarn falling under Ch.54 is clea....
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....notice on 23.03.2019, when the appellant unit 1 was filing regular ER-1 returns about clearance of its entire POY under duty paid invoices to Unit 2 & 3. Equally the application made by the appellant dtd. 21.02.2004, both physically and online, in seeking to amend the registration certificate were duly filed by the Appellant prior to claiming exemption already. Further, this is not case of any suppression or clandestine removal, since the appellant was under the bona fide belief of being eligible to this exemption, having fulfilled all the conditions of Notification No. 30/2004-CE after duly intimating the department about its activities entirely. 2.8 Without prejudice, he also submits that assuming though not admitting that the appellant is to be denied this exemption, even then admittedly the amount of Rs. 8,08,91,469/- which is paid by Unit 1 of the 3 units, even if is considered as one factory as per the revenue, would be available as Cenvat credit. The SCN itself is issued to treat all units as one and denies exemption saying all units in one compound and different buildings is one factory, which means that duty paid upon POY stage, has to be therefore considered as duty pa....
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....Articles - Effective rate of duty to specified goods of Chapters 50 to 63 In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944) read with sub-section (3) of section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957) and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 7/2003-Central Excise dated the 1st March 2003, published in the Gazette of India vide number G.S.R. 137(E), dated 1st March 2003, the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the excisable goods of the description specified in column (3) of the Table below and falling within the Chapter, heading No. or sub-heading No. of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) (hereinafter referred to as the Central Excise Tariff Act), specified in the corresponding entry in column (2) of the said Table, from whole of the duty of excise leviable thereon under the said Central Excise Act : Provided that nothing contained in this notification shall appl....
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....ed 09.07.2004 as amended vide Notification No. 10/2005 dated 01.03.2005 exempts all filament yarn procured from outside and subjected to any process by a manufacturer who does not have the facilities in his factory (including plant and equipment) for manufacture of filament yarns of chapter 54, from payment of whole of Central Excise Duty. Further , benefit of Notification is available to goods of Chapter 54 and 60 of Central Excise Tariff if credit of duty on inputs or capital goods has not been taken under the provisions of the Cenvat Credit Rules, 2002/2004. 4.3 We find that the Appellant claimed the exemption of above Notification on the ground that they were manufacturing POY in Building No.1 of the Factory, Textured yarn in Building No. 2 & 3 of the Factory and Knitted fabrics in Building 3 of the Factory. Appellant paid the Excise Duty amounting to Rs. 8,08,91,469/- on POY manufactured in Building No. 1 and cleared to Building No. 2 & 3 for manufacture of Textured Yarn and Fabric. In the present matter Appellant claimed the all the manufacturing areas are to be treated as separate entity and we find support in claim of the Appellant. M/s. SPPL obtained Central Excise Regi....
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...., against Sr. No. 6 (a) 'Yarns procured from outside' (b) 'Subjected to any process by the manufacturer' (c) 'Who does not have the facilities in his factory for the manufacture of filament yarns of Chapter 54' All the above three expressions used in Notification No. 30/2004-C.E. have been interpreted differently by the Revenue and the appellants. According to Revenue, the yarns should be purchased by the manufacturer from outside. Further, revenue is also of the view that the word 'manufacturer' used in Notification No. 30/2004-C.E. should be interpreted 'manufacturer as a 'legal entity' and that the words 'in his factory' should include all the factories of the manufacturer as a legal entity. Appellants on the other hand argued that words 'procured from outside' used in the notification means that the yarn should have been obtained (whether purchased or not) from outside and the word 'manufacture' should be the same factory/assessee to whom demand is issued. That accordingly the expression 'in his factory' should be treated as 'the same factory'. 9.3 It is observed from the wording of Notification No. 30/2004-C.E., as amended, that the....
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....d in Section 2(f) of the Central Excise Act, 1944 and the person who carries out the 'act of manufacture' is the 'manufacturer'. A 'manufacturer' who is liable to pay duty becomes an 'assessee' by virtue of Rule 2(c) and has to take out a Registration as per the provisions of Rule 9 of the Central Excise Rules, 2002. From the above basic elements of Central Excise law a 'manufacturer' is the person who carries out the 'act of manufacture'. 9.5 In the present proceedings the 'act of manufacture' is being undertaken by the appellants factory to whom demand show cause notices are issued and each factory will make the person carrying out the activity of manufacture as the 'manufacturer'. There is nothing in the definition of Section 2(f) to indicate that a 'legal entity' only has to be considered as a 'manufacturer'. Rather each 'assessee' has to be treated as a manufacturer and not the entire group of companies as claimed by the Revenue. In the present proceedings also even the demands have been issued by the Revenue to the individual assessee carrying out the exempted processes and not to the head offices of the group companies as a legal entity. Therefore, we are of the con....
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....iety or any organization set up or approved by Government for the purpose of development of handlooms; or Nil - - (d) processed by an independent processor approved in this behalf by the Government of India on the recommendation of the Development Commissioner for Handlooms. Explanation. - In this entry, for the purposes of the fabrics woven on handlooms, "independent processor" means a manufacturer who is engaged exclusively in the processing of fabrics with the aid of power and who has no proprietary interest in any factory engaged in the spinning of yarn of wool or weaving of woolen fabrics." 9.8 From the above expression "No proprietary interest in any factory engaged in .....", used in Sr. No. 89 of Notification No. 6/2000-C.E., it is clear that legislature has the vision and skill to express as to what could be the intention of the words 'his factory'. If the intention of legislature to interpret the words 'in his factory' was also to include any other factory of the appellants, then legislature in the notifications has used the words like 'in any factory/factories' of the assessee' or 'no proprietary inte....
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....f section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957) and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 7/2003-Central Excise dated the 1st March 2003, published in the Gazette of India vide number GS.R. 137(E), dated 1st March 2003, the Central Government, being satisfied that it is necessary in the pub lie interest so to do, hereby exempts the excisable goods of the description specified in column (3) of the Table below and falling within the Chapter, heading No. or sub-heading No. of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) (hereinafter referred to as the Central Excise Tariff Act), specified in the corresponding entry in column (2) of the said Table from whole of the duty of excise leviable thereon under the said Central Excise Act: Provided that nothing contained in this notification shall apply to the goods in respect of which credit of duty on [inputs] has been taken under the provisions of the Cenvat credit Rules,[2004] S. No. Chapter or Heading No. or Sub-Heading No. Description of Goods 15. 60 ....