ORDER
S.L. Peeran, Member (J)
1. Both these Revenue Appeals are against the common Order-in-Appeal No. 245/97, dated 19-11-1997 passed by the Commissioner (Appeals), Trichy. In the impugned order, Commissioner (Appeals) has held that the benefit of Notification No. 35/95, dated 16-3-95 as amended by Notification No. 84/95, dated 18-5-95 available to the assessee. This is challenged by the Revenue on the ground that the benefit of notification is not available. However, the findings recorded by the Commissioner (Appeals) that the assessee is entitled to Modvat credit availed on the single yarn which was utilised for the manufacture of double or multifolded yarn is not challenged by the Revenue. The contention is that the proviso to the notification itself clearly states that the exemption in the said notification shall not apply to clearance of yarn from a factory having facilities (including Plant and Machinery) for producing single yarn. It is stated that the assessee’s factory has the facility for manufacturing single yarn and therefore the notification is not applicable. However, they contend that the benefit of Modvat credit can be extended and that portion of the order is not challenged.
2. Appearing on behalf of the Revenue Shri C. Mani to Id. DR pointed out in the proviso of the notification and contended that the Commissioner has committed an error in extending the benefit of the notification without examining the proviso of the notification. He pointed out that the assessee has the facility of manufacturing single yarn and therefore, the benefit of notification is not available as stated in the two show case notices which were issued for the period from 6/95 to 9/95 for Rs. 1,82/432/- and 11/95 to 1/96 for Rs. 11,563/-. However, Id. DR conceded to the other portion of the Commissioner (Appeals)’s order regarding the availability of Modvat credit on the duty paid on single yarn.
3. Appearing on behalf of the Respondents Shri M.V. Raman, Id. Counsel contended that the assessee has the facility for manufacturing single yarn and therefore the prayed made in the Revenue appeal with regard to
the non-availability of exemption notification is correct. However, they are entitled to the benefit of Modvat credit on the duty paid on the single yarn which should be upheld.
4. We have carefully considered the submissions made by both the sides and notice that the Commissioner (Appeals) has overlooked the proviso to the notification which reads “Provided that the exemption contained hereinabove relating to S. No. 1 or 2 shall not apply to clearances of yarn from a factory having facilities (including plant and equipment) for producing single yarn.” In view of the clear exclusion of the benefit to a factory having facilities for producing single yarn, the benefit of the notification is not available to the assessee, ordered accordingly. In so far as Commissioner’s prayer for grant of Modvat credit on the duty paid on the single yarn is concerned, Revenue is not contesting this portion of the finding and therefore, this finding of the Commissioner is sustained. Thus the impugned order is modified by holding that the benefit of the notification in question is not available to the assessee. The impugned order is modified accordingly and both the appeals are disposed of in the above terms.