JUDGMENT
Jeet Ram Kait Member (T)
1. All these appeals arise from a common order in order-in-appeal No 242 to 250/97 (CBE) (D) dated 2.7.1997 in which the Commissioner (Appeals) has rejected all the 9 Department appeals on the ground as given by the Commissioner in his findings in para 6 to 9 which are extracted herein below:-
6. I find that same issue was considered earlier by my predecessor vide order in appeal No. 172 to 485/96 (CBE)(D) dated 25.6.96 relied on by the respondents. The extracts of the above order in appeal vide paras 2 and 3 thereof are reproduced below:-
“In the appeal it is contended that cotton yarn become specified goods under Notification 1/93 with effect from 25.1.94, that the reason which justified exclusion of value prior to 25.4.94 becomes a valid ground for inclusion of value of clearances mad eon or after 25.4.94, that the other issue was whether the payment of duty on the value of clearances during the period would entitle the assessee to exclude that for purposes of notification 1/93.
3. I have considered the same issue earlier and had observed as follows in my order -in-Appeal 283/95 (CBE) dated 1.12.95.
“The product cotton yarn had been brought under purview of Notification No. 1/93 by amendment Notification No. 90/94 dated 25.4.94. In other words cotton yarn became specified goods with effect from 25.4.94 entitled to benefit under Notification 1/93. Duty free first clearances of specified goods are available for a value of Rs. 30 lakhs. In this case the lower authority having regard to clearances of cotton yarn on payment of duty from 1.4.94 held that the value of clearances of Rs. 30 lakhs is computable from 1.4.94 onwards on the premises that there is no provision to exclude clearances made on payment of duty from the first clearances. The lower authority has indeed misread the notification. He has ignored the fact that cotton yarn became specified goods” in terms of Notification 1/93 only with effect from 25.4.94. The clearances prior to this date are clearances of unspecified goods which cannot logically/legally enter the foray of “first clearances of specified goods”. The notification exempt specified goods cleared for home consumption on or after the 1st day of April in any financial year, in the case of first clearances of specified goods up to an aggregate value not (SIC) from the whole of duty of excise leviable there on. When a manufacturer claims this exemption he is entitled to duty fee clearances of value not exceeding Rs. 30 lakhs. The appellants herein has claimed this right on 23.5.94 in terms of classification list filed. The appellant has to be filed held eligible for duty free clearances, of Rs. 30 lakhs from 23.5.94 in view of para 2 of the said notification which would state that the value of clearance of specified goods under Sub-classes (a) (b) and (c) of opening paragraph shall not exceed Rs. 30 lakhs , 20 lakhs and 25 lakhs respectively. The clearances effected by the appellant on payment of tariff rate of duty prior to this date 23.5.94 not being clearances under this notification (by availment of either total exemption or concessional rates under this notification) would be of no relevance except in the computation of aggregate value of clearances in a financial year”. In the light of the above, the respondent are entitled to duty free clearances of Rs. 30 lakhs under Notification 1/93 from the date they start ailing the same.
Viewed thus, the applications do not survive and are rejected.”
7. Though I am not bound by the above order in appeal, I find that I am in full agreement with the logic and reasoning adopted by my predecessor and so I adopt the same to uphold the impugned orders here.
8. An amendment to Notification 1/93 was introduced with effect from 1.4.94 vide Notification 39/94-CE according to which it is for the manufacturer to exercise the option for not availing the benefit of the notification. In that event such manufacturer would have to pay duty at the rate applicable but for the aforesaid exemption on all the subsequent clearances, In the subject appeals, as pointed out by the respondents, it was not as if they had opted to pay duty on 25.4.94 or wanted to remain outside the notification inspite of the exemption being available to them. Such a presumption could be made only if cotton yearn was specified goods with effect from 1.4.94. But here the Notification 90/94 was issued only on 25.4.94. The only reason here was that they did not know about the exemption and as and when they came to know about it which was on different date, they exercised the option for the exemption and filed classification list and started availing the notification. In the circumstances, the respondents would be entitled to the clearance of duty free 30 lakhs under Notification 1/93 from the dates they actually started availing the exemption. IN the light of the above discussions, the case laws cited which are clearly distinguishable would not apply to the peculiar circumstances of this case. Accordingly, there is no merit in the departmental appeals.
9. For the above reasons, I reject all the nine departmental appeals.
2. Aggrieved by this order the Department had filed an appeal on the ground that whether assessee exemption can be availed from the date of inclusion of cotton yarn in notification No. 1/93 or form the date of availment by the assessee and whether the value of duty of clearances has to be included in first clearance of Rs. 30 lakhs for the purpose of exemption. The Department has contended hate the decision of the Commissioner (Appeals), who rejected the Departmental appeal to included the value of clearance from 25.4.94 to 25.5.94 that is the actual date of availment of exemption in the Rs. 30 lakhs value of first clearances is incorrect for the following reasons:-
“The Commissioner’s (Appeals), observation in the impugned order that the appellants were entitled to duty free clearance upto the value of Rs. 30 lakhs, from the dat e when they started availing the exemption, is not justified by the wordings of the notification No. 1/93-CE dated 28.2.93 as amended.
As per notification No. 1/93-CE dated 28.2.93 as amended, value of first clearance of specified goods in a financial year has to be taken into account for the purpose of determining the slab rate concessions under this notification.The appellant authority was right in holding that value of clearances made prior to 25.4.94 was excludable on the ground that cotton yarn became specified goods only on 25.4.94 by amending notification No. 90/94-CE dated 25.4.94. In as much as cotton yarn became specified commodity from 25.4.94, i.e. from the date of issue of notification No. 90/94 value of all clearances of cotton yarn from 25.4.94 has to be taken into account for computing the aggregate value of first clearances of the specified goods not exceeding Rs. 30 lakhs under para (1) (a) of the notification No. 1/93 C. Ex. Dated 28.2.93 as amended. Further while disposing 5 appears involving interpretation of the words First Clearances’ in granting SSI exemption upto Rs. 30 lakhs under notification NO. 175/86-CE, the larger bench of CEGAT, New Delhi, vide final order No. A/374-378/1996-NB dt. 8.2.96 (reported in 1996 ELT 346 (T) in the case of M/s. Ramakrishna Engineering Words and 4 Ors. v. Collector of Central Excise, has held that first clearances means clearances in chronological order upto a limit of Rs. 30 lakhs. As far as the use of the expression ‘first clearances’ is concerned, notification 175/86-CE and notification No. 1/93-CE are similar. Therefore, in view of the decision given by the larger bench of Tribunal for the purpose of computing Rs. 30 lakhs exemption limit the clearances of cotton yarn from 25.4.94 the date on which cotton yarn became specified goods-should be taken into account and not from the date of actual availment s ordered by the Appellate Authority.
The Hon’ble CEGAT, South Regional Bench Madras, vide Final order No. 604/1994 in appeal No. E/382/91 MAS, in the case of CEE, Coimbatore v. M/s. Global Remedies (P) Ltd. (copy enclosed) held that clearances effected on payment of duty should be also included in computing the first clearances upto Rs. 15 lakhs for the purpose of granting exemption in terms of notification 175/86 dated 1.3.86 which is similar to notification of 1/93-CE. While deciding the above order, CEGAT relied upon the decision of High Court judgment in the case of M/s. B.K. Rubber Industries (P) Ltd. v. UoI reported in 1993 (68) ELT 575 (MP) in which Hon’ble High Court while interpreting notification 65/81-CE which is similar to notification 1/93-CE has decided as follows:
“The intention of the Government was clearly to exempt first clearances, i.e. the clearances in the Chronological order upto the aggregate value of Rs. 75 lakhs.”
In view of the above submissions it is prayed that the order of the Commissioner (Appeals) may be set aside as regards non-inclusion of value of clearances made from 25.4.94 to 25.5.94 for computing the aggregate value of first clearances of the specified goods not exceeding Rs. 30 lakhs value and that appropriate orders may be passed in include the duty paid clearances made from 25.4.94 to 25.5.94 for computing Rs. 30 lakhs value as per notification No. 1/93-CE dated 28.3.94 as amended.”
3. Ld. SDR reiterates the ground of appeal which have been extracted (supra).
4. Ld. Consultant Shri G. Suresh, Chartered Accountant has submitted that the issue is covered by the decision of the Hon’ble Tribunal, in CCE, Coimbatore v. Theivasigamani order No. 3330/97 dated 25.11.1997 also in the decision of this Bench in then case of CCE, Coimbatore v. Kumamran Spinning Mills reported in 1998(24) RLT 1986. He has further submitted that the Hon’ble Tribunal has dismissed similar appeals filed by the Department in batch of cases namely CCE, Coimbatore v. Swarnambiga Textiles Appeal No. 50-59-of 10.9.2001.
5. We have considered the submission made by both the sides and find that for availing the SSI exemption under notification No. 1/93-CE dated 28.2.93, the cotton yarn was brought under SSI exemption notification w.e.f. 25.4.1994 and they have opted for exemption on 24.5.1994. In view of the decision mentioned (supra) the issue is no longer res integra and the value of clearance, from the date of availment of the benefit by the assessee, has to be taken for computing first clearance upto Rs. 30 lakhs.
6. We therefore, by respectfully following the decision rendered by the Tribunal in the cases mentioned supra, dismiss the appeal field by the Revenue as we do not find any infirmity in the order passed by the Ld. Commissioner.
Ordered accordingly.
(Order dictated and pronounced in the open court)