- (1.) This appeal has been preferred by the revenue under Section 35G of the Central Excise Act, 1944 (for short, "the Act") against the order of the Customs, Excise & Service Tax Appellate Tribunal, New Delhi dated 21-10-2009, Annexure A-3, proposing to raise following substantial questions of law:- (i) Whether the Hon'ble Tribunal is right in setting aside the appeal of the Department on the ground that no mention of violation of specific condition of Trade Notice No. 3-CE/2002, dated 30-1-2002 was pointed out when in the department in its appeal, whereas it was specifically in para (iv) of the grounds of appeal that the party has failed to discharge the burden that the goods received back were duty paid as required in para (i) of the said Trade Notice and prior permission of the Commissioner, Central Excise was not obtained as per para (ii) of the said Trade Notice? (ii) Whether, the burden of proof that the goods received back were duty paid goods and also that the conditions laid down in the said Trade Notice are fulfilled, does not lie on the said party who had sought to avail benefit in terms of Rule 16(3) of the Rules read with Trade Notice No. 3-CE/2002, dated 31-1-2002? The assessee is engaged in manufacture of Pistons & Gudgeon Fins falling under Chapter 84 of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) and was availing Cenvat Credit. During audit, it was observed that the assessee cleared excisable goods during January 2006 to October 2006 without payment of duty. Accordingly, Show Cause Notice was issued alleging escapement of duty and after considering the stand of the assessee, Order-in-original dated 19-4-2007 was passed, confirming the demand of duty with interest and penalty. On appeal, the stand of the assessee was upheld as under:- I have carefully examined the case records. In the show cause notice dated 8-2-2007 duty amounting to Rs. 1,17,412/- involved on the clearances of excisable goods valued at Rs. 7,19,422/- effected by the appellant during the period January 2006 to October 2006 was demanded. The goods in question were the goods received back by the appellants from their sales depots for reconditioning/repairing etc. under Rule 16(3) of the Central Excise Rules, 2002. The goods after reconditioning etc. were removed by the appellants without payment of duty and as such duty has been proposed to be demanded. The charge for demand of duty is that the appellants have not complied with the procedure laid down in Trade Notice 3/2002, dated 30-1-2002 issued by the Commissioner of Central Excise, Chandigarh. It is alleged that the appellants had not obtained prior permission as required under the said Trade Notice. The appellants submit that the goods received back from their sales depots, for reconditioning etc. were already duty paid. The processes of reconditioning, reprocessing undertaken by them did not amount to manufacture and therefore no further duty could be demanded on removal of such goods. The appellants also submit that they have obtained the necessary permission as required under Trade Notice 3/2002, dated 30-1-2002 from the Commissioner of Central Excise, Chandigarh under this Office letter C. No. IV/(16) Tech/182/06/95, dated 8-1-07. The appellants submitted a copy of this permission. They contended that there was no case for demand of duty or imposition of penalty. From the records, I find that the appellants have paid duty on the goods which were received back from their sales depots for reconditioning, reprocessing etc. The department has not produced any evidence to indicate that the processes undertaken by the appellants amounted to manufacture. I have perused copy of letter being C. No. IV/(16)/Tech/182/06/95 dated 8-1-07 and I find that the Commissioner of Central Excise, Chandigarh has granted permission to the appellants under Rule 16(3) for the financial year 2006-07. On the face of these findings, the charge that the appellants had not obtained permission is devoid of any merit. No case for demand of duty is made out against the appellants. The order appealed against is set aside.
(2.) The above finding has been affirmed by the Tribunal.
(3.) We have heard learned counsel for the appellant.;