whether simultaneous availment of two notifications permissible ?

PJ/Case Laws/2012-13/1326

Case:-M/s PERFECT KNITTERS LTD Vs CCE, HYDERABAD

Citation:- 2012-TIOL-1748-CESTAT-BANG

Brief Facts:- The appellant is manufacturer of cotton knitted processed fabrics under chapter heading 60019100. The appellant has availed benefit of exemption under Notification No. 29/2004-CE in respect of DTA clearances and in respect of clearances made on export, appellant has paid duty 4% availing benefit under Notification No. 59/2008. The Department issued show cause notice alleging that they were not required to pay duty on goods cleared for export and therefore they were not eligible for taking CENVAT credit on capital goods. Original authority dropped the proceedings. On appeal by the Department, Commissioner (Appeals) has confirmed the demand of duty along with interest but has not specified quantum of duty and interest amount. However, the appellant has estimated the duty demand to be Rs. 20,47,358/- based on the show cause notice and has imposed penalty.

Appellant Contentions:- The ld. Advocate relying on the stay order of the Tribunal in the case of Shrijee Lifestyle Pvt. Ltd. Vs CCE, Thane-I (2012-TIOL-65-CESTAT-MUM) contended that appellant are not prevented from availing simultaneously two notifications, one for domestic clearances and the other for exports, and therefore, their availing credit was legal and proper.

Respondent Contentions:- The Respondent relying on Board’s Circular No. 937/27/2010-CX submits that the appellant has no justification to avail the Notification No. 59/2008 in respect of clearances made for export when the goods are otherwise unconditionally exempted under Notification No. 29/2004.

Reasoning of Judgment:- Tribunal has perused the records and submissions from both sides. Tribunal finds that the Stay Order in the case of Shrijee Lifestyle Pvt. Ltd. (supra), considered availment of benefit of Notification No. 29/2004 for Domestic clearances and benefit of Notification No. 59/2008 for clearances made for exports. Tribunal said that the availment of two notifications was permissible. Tribunal waives pre-deposit of the dues as per the impugned order and stay recovery thereof till the disposal of the appeal.

Decision: - Stay Granted.

Comment: The analogy drawn from the case is that simultaneous availment of two or more notifications that are benefit to assessee can be done but keeping in mind the fact that double benefit is not taken like the assessee cannot avail two benefit notifications for input stage credit while the assessee is permissible to avail one benefit notification for input stage credit and other benefit notification at finished goods stage. In the instant case also benefit of two notifications is admissible due to the fact that one is in respect of DTA clearances and the other is for export clearances.

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PJ/Case Laws/2012-13/1326

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