COMMISSIONER OF CENTRAL EXCISE, Vs. POLYMER PAPERS LTD.

JUDGEMENT

(1.) IN the impugned order the learned Commissioner (Appeals) held, "I hold that the respondents herein have rightly availed the benefit of exemption provided in the Notification No. 18/95 on 16 -3 -1995 and 8/96 -CE, dated 23 -7 -96 prior to 1 -3 -97 and w.e.f. 1 -3 -97, the same would fall under Chapter sub -heading 4811.39. I thus hold that the order of the Adjudicating Authority is not legal and proper. Hence the same is set aside."

(2.) THE facts of the case in brief are that the respondents herein are engaged in the manufacture of Impregnated Filter Paper, Filter Filament, PVC Compound Glue and Adhesive. The respondent is also availing Modvat credit of duty paid on inputs under Rule 57A of the Central Excise Rules, 1944.

(3.) DURING the course of checking of RT -12 returns for the month of October, 1996 it was observed that the respondents herein availed exemption under Notfn. Nos. 18/95 and 8/96. The Department alleged that impregnated filter paper is not classifiable under sub -heading 4811.30 w.e.f. 1 -3 -97 and is not covered by Notfn. Nos. 18/95, 8/96 and 13/96 as the said filter paper is not manufactured out of base filter paper which is impregnated with synthetic resin, solvent and other special additives. A show cause notice was accordingly issued asking the respondents herein to explain as to why duty demanded under various show cause notices should not be recovered from them and why penalty should not be imposed. The Deputy Commr. adjudicating the case held that impregnated filter paper was classifiable under Chapter sub -heading 4811.30 up to 28 -2 -97 and under Chapter sub -heading 4811.31 from 1 -3 -97 and that concessional rate of duty under Notfn. No. 18/95 or 8/96 as claimed by the respondents was not admissible. The learned Deputy Commissioner confirmed the demand of Rs. 1,43,54,479.92 and imposed a penalty of Rs. 10,00,000/ -. When the respondents herein filed an appeal before the learned Commr. (Appeals), he held as indicated above.