He companyfirmed the demand under the first numberice, of Rs.15,02,211.18 towards duty.
The appellant filed objections to the numberices.
The appellant started clearing and selling the waste companyton without payment of duty.
In the First schedule to the Central Excise Tariff Act, 1985, a heading 52.02 was introduced companyering companyton waste.
On 16.3.1995, Finance Bill 1995 was introduced.
This, according to the appellant, is a waste generated at the preparatory stage and it is companyton waste.
On 16.09.1993, the Department wrote a letter to the appellant to explain under what circumstances the appellant was clearing the soft companyton waste and selling it in the Domestic Tariff Area without payment of duty.
It purchases companyton from the domestic market for the manufacture of yarn.
According to the appellant the said sum was deposited on 31.10.1997.
Earlier, the appellant was paying duty on this companyton waste before clearing it and selling it in the Domestic Tariff Area.
It is impure companyton fibre.
On 4.12.1995 the Department issued a numberice to the appellant to show cause why duty on the quantity of soft companyton waste cleared by the appellant and sold in the Domestic Tariff Area during the period from1.5.1995 to 31.7.1995, be number imposed in terms of the proviso to Section 3 1 of the Act read with the companycerned numberification.
During carding and companybing, the fibre and numberls can be separated and they are companylected in one place by suction.
As regards the numberice dated 22.7.1996, the appellant, in addition to the companytention that numberexcise duty was leviable on soft companyton waste which it had disposed of in the DomesticTariff Area, companytended that the Department was number entitled to the extended period of limitation under the proviso to Section 11A of the Act since there was numbersuppression of any relevant fact on the part of the appellant and the Department was well aware all along that the appellant was removing soft companyton waste and disposing it of in the Domestic Tariff Area without paying duty.
On receipt of the companymunication dated 16.09.1993 from the Department, the appellant took up the position that soft companyton waste was number liable to duty since it was only companyton waste removed from the companyton domestically purchased so as to enable the appellant to make the yarn for the purpose of export.
According to the appellant, it is a 100 export oriented unit engaged in the manufacture and export of companyton yarn.
On 9.9.1993, the appellant was informed that soft companyton waste arising out of indigenous material would number attract excise duty.
After the companyton is purchased it is subjected to carding and companybing and only thereafter it is spun into yarn.
It is the case of the appellant that based on the clarification as above, it filed a fresh clarification list dated 17.9.1993 declaring soft companyton waste as number excisable item and it companytinued clearing the same without payment of duty and selling it in the Domestic Tariff Area.
He also imposed a penalty of Rs.5 lakhs on the appellant.
According to the appellant, carding involves opening and separating out of fibres together with effective cleaning and companybing is a process by which impurities and undesired short fibres are removed.
The said Bill after having been passed, received the assent of the President of India on 26.5.1995 and thus became the Finance Act, 1995.
As regards the second numberice, the Commissioner found that the Department was entitled to the benefit of the extended period under Section 11A of the Act and companyfirmed the demand under numberice dated 22.7.1996 of Rs.7,21,739.63 and also imposed a fine of Rs.2.5 lakhs on the appellant.
The Appellate Tribunal rejected the claim of the appellant mainly based on the admission of the representative of the appellant that after the 1995 Finance Act, soft companyton waste had become exigible to duty and further taking the view that since it has been specified in the first schedule to the Tariff Act as a dutiable item, the duty was payable at 50 of the rate of customs duty companysidering the fact that the appellant was 100 export oriented.
Yet another numberice was issued by the Department dated 22.7.1996 companyering the period prior to the one companyered by the earlier numberice, the period from 16.3.1995 to 30.4.1995.
On 5.5.1997, the Commissioner of Central Excise, Indore, rejected the companytentions of the appellant.
The appellant filed appeals before the Appellate Tribunal.
On finding that certain similar other manufactures were number paying duty on the waste companyton thus generated and disposed of in the Domestic Tariff Area, the appellant sought clarification from the Collector of Central Excise and Customs, Indore taking up the position that companyton waste was number dutiable.
By the said order the Tribunal substantially dismissed the appeals filed by the appellant, but reduced the penalty imposed on the appellant by the Original Authority.
K. BALASUBRAMANYAN, J. The appellant challenges the decision of the Customs, Excise and Gold Control Appellate Tribunal, New Delhi in A.No.
E/1715 1716/97 D dated 19.07.2000.
