COMMISSIONER OF CENTRAL EXCISE Vs. FAVOURITE INDUSTRIES

JUDGEMENT

(1.) For the sake of convenience, we take the facts in C.A.NO.949/2004, for disposal of these appeals.

(2.) The core issue that falls for our consideration and decision is: whether the finished goods manufactured by the 100% Export Oriented Unit ('the EOU' for short) out of the raw material supplied by another 100% EOU, and subsequently, cleared in the Domestic Tariff Area (for short "the DTA") in accordance with the EXIM Policy 1997-2002 are entitled to the benefit of the exemption provided under the Notification No.8/97-CE, dated 1.3.1997. In the alternative, whether the adjudicating authority is justified in holding that the assessee cannot take the benefit of the Notification No.8/97-CE, dated 1.3.1997 and the assessee, at the most, can take benefit of the Notification No.2/95-CE, dated 4.1.1995.

(3.) Brief facts, as noticed by the adjudicating authority may be stated: M/s. Favourite Industries, respondent herein, is engaged in the manufacture of processed Polyester Grey Man Made fabric, falling under chapter subheading 5407.51 of the Customs Tariff Act, 1975 and chapter sub-heading 5406.10 of the Central Excise Tariff Act, 1985 (for short "the Tariff Act"), out of raw materials obtained indigenously and/or imported free of Central Excise/Customs duties, as the case may be, under the obligation of export of the final product as well as clearance of final product in the DTA on payment of appropriate duty as applicable from time to time as provided under the EXIM Policy for the period commencing from 1997 to 2002.