Archana Wadhwa, Member (J)

1. Both the appeals are being disposed of by a common order as the issue involved is the same. Duty of Rs. 1,05,012.00 and Rs. 1,85,386.00 has been confirmed against the appellants vide impugned orders and penalty of Rs. 5,000/- has been imposed in each appeal. The said amount of duty has been confirmed against the appellants by the authorities below on two grounds :

(a) Firstly, that the appellants were not entitled to avail the benefit of small scale exemption 1/93 and the Modvat credit facility simultaneously in respect of the same goods;

(b) Secondly, on the ground that the duty paid clearances made by the appellants have to be added for the computation of exemption slab of Rs. 30 lac, Rs. 50 lac and Rs. 75 lac in terms of Notification No. 1/93-C.E., dated 28-2-93.

2. Arguing on the appeals, Shri P.K. Das, learned Advocate submits that though on the first issue, Larger Bench decision in the case of Kamani Foods v. C.C.E. reported in 1995 (75) E.L.T. 202 (T) is against the appellants but the earlier decision in the case of Faridabad Tools Pvt. Ltd. v. C.C.E. -1993 (63) E.L.T. 759 (T) was upheld by the Supreme Court and the appeal filed by the Department was dismissed. Following the dismissal of the Revenues appeal by the Supreme Court in the case of Faridabad Tools Pvt. Ltd., the Tribunal has been following the ratio laid down in Faridabad Tools case. In support, he relies upon the Tribunals judgment in the case of Jallo Subsidiary Industries Company (India) Pvt. Ltd. v. C.C.E., New Delhi - 1998 (26) RLT 556 (CEGAT).

3. As regards the second issue, he submits that the similar situation prevails inasmuch as the Larger Bench decision in the case of Rama Krishna Engineering Works -1996 (83) E.L.T. 346 is against the appellants but the earlier favourable decision was upheld by the Honble Supreme Court while dismissing the Revenues appeal. Thereafter, the Tribunal in a number of cases has followed the earlier favourable decision instead of following the Larger Bench decision. On this ground, he submits that appeals be allowed.

4. Shri R.K. Roy, learned JDR appears for the Revenue and reiterates the reasonings of the authorities below and submits that as far as Larger Bench decisions are against the appellants, the impugned orders be upheld.

5. After considering the submissions made by both sides we agree with the learned Advocate that though Larger Bench decisions are against the appellants but it is seen that on both the issues, the appeals filed by the Revenue against the earlier orders of the Tribunal holding in favour of the assessee were dismissed. As to what is the effect of dismissal of appeals by the Honble Supreme Court was considered by the Apex Court in the case of V.M. Salgaocar and Brothers Pvt. Ltd. v. Commissioner of Income Tax reported in 2000 (38) RLT 619 (S.C.). It was held that whereas dismissal of SLP by non-speaking order does not amount to comments on the correctness or otherwise of the order of the High Court or Tribunal, it is not so in the case of dismissal of appeal by a short order as the doctrine of merger applies; in the case of appeal and the impugned order gets merged with the Supreme Court order of the dismissal. As we note that the appeal filed by the Revenue against the earlier order was dismissed by the Honble Supreme Court, the seal of approval of the Honble Supreme Court on the correctness of those decisions can be said to have been given. We also note that subsequently, the Tribunal in a catena of judgments held in favour of the assessee on both the said issues. Accordingly, following the ratio of this decision we set aside the impugned orders and allow both the appeals with consequential relief to the appellants.