(1.) THE Revenue has come up in appeal against Order -in -Appeal No. 13/Appl/Chd -I/11 dt.25.3.2011 wherein the Commissioner (Appeals has dropped the demand holding that finished goods received back in the factory of the respondent were subjected to the process as enumerated in Rule 16 of Central Excise Rules, 2002. Order was examined by the Revenue and they found that order in appeal was not legal and proper and came up in appeal before the Tribunal.
(2.) BRIEFLY stated the facts of the case are that M/s.Satia Synthetics Ltd. are engaged in the manufacture of cotton yarn falling under chapter 5205.11 of the first schedule to Central Excise Tariff Act, 1985. The assessee availed cenvat credit of the duty paid on the cotton yarn amounting to Rs.4,40,006/ - on 07.7.2004 received back from their depots located at Ludhiana and Delhi. The cotton yarn was subsequently exempted from payment of duty vide Not.No.30/2004 -CE dated 09.7.2004. The party removed these goods i.e. cotton yarn without payment of duty in terms of exemption granted vide the notification ibid.
(3.) SHOW cause notice invoking extended period of limitation alongwith interest and imposition of penalty was adjudicated by the authority vide Order -in -Original NO. 22.1.2010 vacating the demand holding that the process carried out by the respondent amounted to manufacture. Department challenged the Order -in -Original before the Commissioner (Appeals). However, Commissioner (Appeals) dismissed the departmental appeal and concurred with the adjudicating authority and upheld the order passed by the adjudicating authority.