- (1.) Delay condoned.
(2.) These cross appeals are filed by M/s Modipon Fibre Company and the Department under Section 35L of Central Excise Act, 1944 against order dated 3.7.2001 passed by the Customs Excise & Gold (Control) Appellate Tribunal ("CEGAT") holding that the assessee was entitled to deduction in respect of turnover tax ("TOT") only at 0.5% and not at 2% as claimed.
(3.) The appellant-assessee is engaged in the manufacture of Nylon and Polyester Yarn which is manufactured in its factory in U.P. and cleared to its various Depots situated all over India including Surat from where the Yarn is sold to dealers. The assessee used to pay duty during the relevant period, at the time of removal of yarn, on the basis of the depot sale price, after claiming permissible deductions under section 4 of the Central Excise Act, 1944 ("1944 Act"). One such deduction was TOT in respect of yarn cleared and despatched to Surat depot from the factory of the assessee in U.P.. In respect of such despatch, the assessee claimed deduction at 2% on account of TOT. This was on the footing that the Government of Gujarat vide Notification dated 19.10.1993 had exempted sale of Yarn of all kinds by a registered dealer to a special manufacturer of processed Yarn or to an eligible unit to the extent to which the rate of TOT exceeded 0.5% of the total turnover. This was provided the specified manufacturer furnished to the selling dealer a certificate in Form 26 and if the processed Yarn stood sold within the State of Gujarat.;