ORDER
Archana Wadhwa, Member (J)
1. The appellant are engaged in the manufacture of Organic Compounds and Bulk Drugs. Both the products are classifiable under Chapter 29. The appellant is small scale unit and filed a classification list effective from 1.04.96. In the said classification list, they claimed the benefit of small-scale exemption under notification No. 1/93-CE dated 28.02.1993. As per the declaration made in the said classification list, the appellant was to clear both the products under the concessional rate of duty. However, during the period April 96- December 96, the appellants cleared bulk drugs on full rate of duty instead of availing the concessional rate in terms of the classification list filed by them.
2. On the above basic, they were asked to pay full rate of duty in respect of other product, i.e. Organic Compounds in terms of Paragraph 4 of the Notification No. 1/93 which is to the effect that the manufacturer can opt, out of the benefit of the exemption subject to the condition that for all subsequent clearances of the specific goods, he will have to continue with the said option. In other words, once the assessee opts out of the small-scale exemption benefit, he cannot opt for the same in the same financial year. On the above basic proceedings were initiated against them by way of issuance of various show cause notices.
3. These notices were adjudicated by the Assistant Commissioner who accepted the appellants stand that they never opted out of the small-scale exemption and the duty on the bulk drugs during the relevant period was paid at a full rate, by mistake by their employee who was newly appointed. He further observed that in any case, the appellant has paid more duty by way of clearing the bulk drugs at the normal rate of duty instead of concessional rate. The said order was appealed against by the revenue before the commissioner (Appeals), who after taking notification of paragraph 4 of the notice in question set aside the order of the authorities below. Hence the present appeal.
4. After hearing both the sides, we find that paragraph 4 of notification No. 1/93 is applicable in a situation where the manufacturer exercises his option not to avail the benefit of exemption notification. The expression “Option” by its very nature gives a choice to the assessee either to avail the exemption or not to avail the same. As such, it is very necessary that the assessee must “Opt for” not availing the exemption which reflects open conscious decision on the part of the assessee. However, payment of duty on one of the product by mistake, cannot be equalised to options as to invoke the said paragraph against assessee. The appellant having filed a classification list claiming the benefit of notification No. 1/93 in respect of both the products, it can be safely concluded that the assessee opted for the exemption benefit and the payment at normal rate for a limited period in respect of one of the product was an error on the part of the appellant and not their option. In view of this, we find that the order of the original adjudicating authority is just and proper and requires to be restored. Accordingly we set aside the impugned order of the Commissioner (Appeals) and restore the order of the original adjudicating authority.
5. The appeal is thus allowed with consequential relief to the appellant.
(Pronounced in Court on 7/01/05)