TATRA TRUCKS INDIA LTD. Vs. CCE

JUDGEMENT

(1.) ONE of the appeals is by the Revenue and the other by the assessee, both against the same order of the Commissioner (Appeals). The assessee is engaged in the manufacture of what they call "Dumper" [SH 8704.30] and the department calls 'Dumper Chassis" [SH 8706.49]. A show -cause notice was issued to them for recovery of National Calamity Contingent Duty (NCCD) at 1% on the "dumper chassis" in terms of Section 136 of the Finance Act, 2001 and for imposing penalty for nonpayment of NCCD. The original authority confirmed the demand against the assessee and imposed on them a penalty of Rs. 10,000/ - after holding that (a) the assessee's product was only dumper chassis [SH 8706.49] and could not be considered as 'incomplete or unfinished dumper having the essential character of dumper' for classification under SH 8704.30; (b) NCCD was leviable on this product and (c) the benefit of Notification No. 67/95 -CE was not available to NCCD. In the appeal filed by the assessee, learned Commissioner (Appeals) endorsed the view taken by the lower authority that their product was dumper chassis rather than dumper. But the appellate authority held NCCD to be a duty of excise for purposes of Notification No. 67/95 -CE and accordingly granted the benefit of exemption to the assessee. At present, the assessee is aggrieved by the concurrent view taken by the lower authorities to the effect that their product is dumper chassis and not dumper. The Revenue is challenging the grant of exemption under Notification No. 67/95 -CE to the assessee in respect of NCCD.

(2.) AFTER hearing both sides and considering the case law cited by them, we find that the question whether NCCD is a duty of excise for purposes of Exemption Notifications issued under Section 5A of the Central Excise Act has been considered and answered in the affirmative in Toyota Kirloskar Motor Pvt. Ltd. v. CCE, Bangalore 2007 (82) RLT 828 (CESTAT - Ban.), wherein the benefit of Notification No. 108/95 -CE dated 28.8.1995 was held to be admissible to NCCD leviable under Section 136 of the Finance Act, 2001. We agree with that decision, which was rendered after examining the relevant provisions of the Finance Act and considering a Circular of the CBEC. The contention raised by the Revenue that NCCD is only a surcharge and not a duty of excise cannot be accepted. The Revenue, in their appeal, has also claimed support from the Supreme Court's judgment in Union of India and Ors. v. Modi Rubber Limited and Ors. wherein it was held that exemption from duty of excise did not mean exemption also from Special Excise Duty, Additional Excise Duty or Auxiliary Duty. We find that this case law is not applicable to NCCD in view of Sub -section (3) of Section 136 of the Finance Act, 2001, which reads as under: