2025-VIL-2064-CESTAT-CHE-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise – Rule 6 of CENVAT Credit Rules, 2004 – Manufacture of relays – Entitlement of exemption – Appellant manufactures Relays and uses them captively in manufacture of Control Panels – Appellant cleared Control Panels without payment of duty by availing benefit under Exemption Notification No.12/2012-CE – Appellant claimed exemption for captive consumption of relays under Notification No.67/95-CE – Department denied exemption on ground that final products (Control Panels) were also cleared under an exemption Notification 12/2012 and therefore, proviso to Notification 67/95-CE barred captive exemption – Adjudicating Authority confirmed demand of duty – Commissioner (Appeals) upheld order passed by Adjudicating Authority – Whether Appellant is entitled to benefit of captive consumption exemption under Notification No.67/95-CE in respect of relays manufactured and used captively in manufacture of control panels, when such panels are cleared without payment of duty under Notification No.12/2012-CE – HELD – There is no dispute that relays are manufactured within factory of Appellant and are used within factory of production for manufacture of control panels. Relays fall within scope of “all goods falling under First Schedule to Tariff Act” as mentioned in column (1) of Table to Notification No.67/95-CE and do not fall in list of excluded inputs. On a plain reading of main body of Notification, relays clearly satisfy the conditions for captive exemption. Captive exemption under Notification No.67/95-CE is a part of scheme to avoid cascading duty on in-house intermediates. Scheme cannot be lightly defeated merely because some final clearances avail a separate benefit under a general exemption notification. Appellant is entitled to benefit of captive consumption exemption under Notification No.67/95-CE in respect of relays manufactured and used captively in manufacture of control panels – Appeal allowed - Discharge of obligation – Whether Appellant has discharged obligation under Rule 6 of the Rules so as to fall within proviso (vi) to Notification 67/95-CE – HELD – In Appellant’s earlier proceedings on an identical issue, this Tribunal had granted relief after being satisfied that Appellant was operating within Rule 6 framework and there was no case of improper availment of credit. On doctrine of consistency and judicial discipline, it would not be open to this Tribunal now to ignore that settled factual and legal position in Appellant’s own case in absence of any new material. Appellant had discharged obligation under Rule 6 of the Rules to fall within proviso (vi) to Notification 67/95-CE. Impugned order passed by Commissioner (Appeals) is set aside.
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