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of <h1>Dispute over Duty Exemption for Shoe Components</h1> The case involved a dispute regarding duty exemption under Notification No. 2/95 for clearances to a domestic unit by a 100% EOU manufacturing shoe ... Export - DTA clearance by 100% EOU - Entitlement to Notification No. 2/95-C.E. Issues:1. Eligibility for duty exemption under Notification No. 2/95 for clearances to a domestic unit.2. Rejection of appeal due to clearances without CT-2 cover and Chapter X Procedure.3. Applicability of Notification No. 47/94-C.E. (N.T.).4. Non-availability of exemption due to failure to follow Chapter X Procedure and obtain CT-2 certificates.Eligibility for Duty Exemption under Notification No. 2/95:The case involved a 100% EOU engaged in manufacturing shoe components that cleared goods to a domestic unit without duty payment. The issue was whether they were eligible for duty exemption under Notification No. 2/95. The adjudicating authority demanded duty and interest, alleging the supply was not for export but to a DTA unit. However, the ld. Commissioner (Appeals) noted a Tribunal order in the appellant's favor, granting duty exemption for similar clearances to domestic buyers for eventual export. The Tribunal reiterated that the goods were sold for foreign exchange and used in manufacturing exported shoes, thus qualifying for duty exemption.Rejection of Appeal and Compliance Issues:The Commissioner rejected the appeal due to clearances lacking CT-2 cover and non-compliance with Chapter X Procedure. The appellants contested this decision, emphasizing that the goods were used in manufacturing exported shoes, as acknowledged by both lower authorities. While the show cause notice questioned duty exemption under Notification No. 2/95, the authorities also considered the applicability of Notification No. 47/94-C.E. (N.T.). The duty liability was upheld solely on the grounds of non-compliance with Chapter X Procedure and absence of CT-2 certificates.Applicability of Notification No. 47/94-C.E. (N.T.):The judgment highlighted the relevance of Notification No. 47/94-C.E. (N.T.) in the context of duty exemption for clearances to domestic buyers for subsequent export. The Tribunal's previous decision in the appellant's favor under this notification underscored the importance of proper interpretation and application of relevant legal provisions to determine duty liability in such cases.Non-Compliance and Duty Liability:The central issue revolved around the appellants' failure to adhere to Chapter X Procedure and obtain CT-2 certificates for the clearances in question. Despite the absence of these documents, the Tribunal's previous ruling favored the appellants, emphasizing that removals to domestic customers for ultimate export should not attract duty liability. The judgment reiterated the significance of following established procedures while also recognizing the overarching objective of duty exemption for goods ultimately utilized in exported products. Consequently, the appeal was allowed with all consequential reliefs, aligning with the Tribunal's earlier decision and prevailing legal principles.
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