JUDGMENT

KAPADIA, J. —

This civil appeal is filed by the Department under Section 35L(b) of the Central Excise Act, 1944 against the judgment dated 20.7.2001 delivered by the Customs, Excise and Gold (Control) Appellate Tribunal (“CEGAT”) in Appeal No. E/1758/2000.

2.The issue which arises in this civil appeal is as to whether in the absence of any “sale”, rule 57CC of the Central Excise Rules, 1944 would have any application or not. The contention of the assessee is that in the case of “stock transfer” there is no “sale” and, therefore, rule 57CC was not applicable. This contention has been accepted by the Tribunal, hence this civil appeal.

3.The assessee is engaged in manufacture of paper falling under Chapter 48 of the Central Excise Tariff. The assessee is availing the benefit of MODVAT Scheme under Rule 57A of the Central Excise Rules, 1944 (for short, “1944 Rules”). The assessee is also manufacturing pulp falling under Chapter 47 of the Central Excise Tariff, which is chargeable to nil rate of duty. The said pulp is captively consumed for the manufacture of paper. According to the assessee, a small portion of the pulp is sent to the sister unit of the assessee at Asthi. According