ORDER
Smt. Archana Wadhwa
1.
The prayer in the application is for dispensing with the condition of predeposit of duty amount of Rs.1,05,07,421.12 and personal penalty of Rs.10 lakhs confirmed by the Commissioner vide his impugned order-in-original.
2. Arguing on the application Shri D.B. Desai, ld. authorised rep. submits that the appellants during the material period were engaged in the manufacture of they were procuring granules from outside and sending the same to their job worker for manufacture of intermediate bare films, after availing the modvat credit on the granules. There is no dispute as regards the eligibility of the appellant of avail confessional rate of duty in terms of notfn.no.53/88 and 14/92 in respect of the said Items. However, he submits that they were also buying bare films from their manufacturers directly and were availing the benefit of the said notification in question. The Revenue entertained a view that since one of the conditions of the said notification is that the laminated plastic films should have been manufactured out of articles falling under heading 39.01 to 39.15 and inasmuch as the bare plastic films fall under heading 39.20, the benefit of the notification will not be available to the appellants. Accordingly a show cause notice raising demand of duty for the period April 1989 to November 1993 was issued to them on 30.3.94, which culminated into the impugned order passed by the Commissioner of Central Excise, Calcutta.
3. Arguing on the issue involving Shri Desai submits that the Board has clarified the above position vide its circular No.44/90- CX 3 dt.22.8.90 wherein it has been clarified that even if the metallised plastic films had been manufactured out of the bought out base films which in turn have been manufactured out of the duty paid material falling under heading 39.01 to 39.15, the benefit of the notification cannot be denied. He submits that the said circular was binding upon the Commissioner and he should have followed the same. As regards the factual position i.e. whether bare films in question were manufactured out of materials falling under heading 39.01 to 39.15 he draws our attention to the gate passes issued by the manufactured of the same wherein the benefit of notfn.no.53/88 has been availed by them. This factor, submits the ld. adv., makes tickler that the duty paid bare films have manufactured out of the raw materials as specified in notfn.no.53/88 and have been cleared by their manufacture after availing the confessional rate of duty. He however submits that the said fact, though, was placed before the adjudicating authority, has not been dealt with by him inasmuch as he has confirmed the demand on the first principle itself that the benefit of the notification is not available in such as situation. He also draws our attention to the earlier Tribunal’s decision in the case of CCE, BBSR. v. Alecoment Ltd.-1998 (108) ELT 795 (T) as also to the Tribunal’s decision in the case of Grasim Indus. v. CCE, Indore-2000 (38) RLT 1087. Reference has also been made to the other decisions of the Tribunal laying down the proposition that the benefit of the notification in question would be available even if the bare plastic films have been purchased from other manufacturers, subject to the condition that the assessee is able to show that such bare film have been manufactured out of duty paid primary plastic materials falling under heading no.39.01 to 39.15.
4. We have also heard Shri Ramesh Chowdhury, ld. adv. and Shri B.N.Pal, ld. adv. appearing for the Revenue. The ld. adv.s reiterated the findings of the adjudicating and drew our attention to the reasoning given by him. It is submitted that inasmuch as admittedly the raw material for the laminated plastic films was not falling under any of the headings 39.01 to 39.15 the benefit has been rightly denied by the adjudicating authority. Shri Chowdhury also argued that the Board’s circular was not placed before the Commissioner and as such there was no occasion for him to go through the same.
5. After giving our careful consideration to the issue involved before us we find that the issue on principle is no more ‘res integra’ Apart from the decisions referred to by the ld.adv., there is a Board’s circular clarifying the issue. As per the settled law the Revenue authorities are bound by the said circular. As such we hold that the benefit of notfn. no.53/88 or 14/92, as the case may be cannot be denied to the appellants on the grounds simpliciter that in instead of using the granules in their own factory they have bought bare films manufactured out of such granules and as such have contravened the condition of the notification. However, the appellants, before availing the benefit, are required to establish that the bare films were manufactured out of the duty paid primary plastic material falling under headings 39.01 to 39.15. As per the appellants, though this evidence was placed by them before the Commissioner, the same was not considered by him. As such we feel that the matter requires to go back to the Commissioner for consideration of the above factual position. Accordingly we set aside the impugned order and remand the matter to the Commissioner for verifying the above factual aspect on the basis of the records and evidenced produced by the appellants. Inasmuch as the appeal itself has been remanded, the stay petition also gets disposed of.
Dictated in the Court.