GTC INDUSTRIES LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) During the material period (April, 1994), the appellants were engaged in the manufacture of machine -rolled cigarettes (CSH 2403.11 of the Schedule to the Central Excise Tariff Act, 1985) using "cut tobacco" (input) procured, from the market by paying duty @ Rs. 50/ - per Kg. prescribed under Notification No. 356/86 -C.E., dated 24 -6 -86 (as amended) and by following the procedure prescribed under Chapter X of the Central Excise Rules, 1944. Under another Notification No. 355/86 -CE., dated 24 -6 -86, cigarettes manufactured out of duty -paid cut tobacco were exempt from so much of the duty of excise leviable thereon as was equivalent to the duty of excise (leviable under the Central Excises and Salt Act) already paid on "cut tobacco" used in the manufacture of such cigarettes. However, such exemption was available only to cigarettes cleared for home consumption. The following proviso was added to Notification No. 355/86 -CE. by the amending Notification No. 69/94 -CE., dated 15 -3 -94 : -

(2.) In April, 1994, the appellants exported under bond a certain quantity of cigarettes, wherein a quantity of 7095 Kgs. of duty paid cut tobacco was used. The amount of duty which had been paid on the said quantity of 7095 Kgs. of cut tobacco was Rs. 3,54,750/ - @ Rs. 50/ - per Kg. in terms of Notification No. 356/85 -C.E. The appellants filed application dated 12 -7 -94 with the Asstt. Collector for credit of this duty for utilization towards payment of duty on cigarettes to be cleared for home consumption in terms of the above proviso to Notification No. 355/86 -C.E. The claim was rejected by the Asstt. Commissioner by order dated 23 -8 -95 without giving the party any opportunity of personal hearing. In the appeal preferred by the party against the order of the Asstt. Commissioner the Commissioner (Appeals) set aside the order of the lower authority and remanded the case to that authority for de novo adjudication in accordance with law and the principles of natural justice. The remand order had noted the submission of the party that they were prepared to produce the relevant AR -4 (duly certified by the Customs authorities) and other related documents in support of their claim. It enabled the party to produce the certified AR -4 and other related documents to the original authority. In the remanded proceedings, however, the party could not produce the original AR -4, though they produced the original Shipping Bill, original GP -2 and a copy of the bank certificate evidencing realization of export proceeds. The original authority rejected the claim of the party on the ground that the original AR -4 was not produced. The aggrieved party again approached the Commissioner (Appeals) but the latter only affirmed the order passed by the adjudicating authority. Hence the present appeal.

(3.) Heard both sides.