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of <h1>Customs Duty Exemption Upheld for HSD Oil in 100% EOU Manufacturing - Revenue Appeal Rejected</h1> The appeal regarding the interpretation of exemption notification for Additional Customs Duty on HSD Oil imported by a 100% EOU was dismissed. The ... EOU - whether the HSD Oil imported by the respondent, who is a 100% EOU, was required to discharge the Additional Customs Duty (HSD) - the imported material stand utilized by them for manufacture of final product which stand exported and there is no dispute that such HSD oil stand utilized for the purposes other than one declared by 100% EOU - the issue is no more res integra and Larger Bench of the Tribunal in the case of M/s Paras Fab International Vs. CCE Kandla [2010 -TMI - 77759 - CESTAT, NEW DELHI], has held that the entire premises of 100% EOU has to be treated as warehouse and the goods directly imported into the EOU premises and manufacturing and other operations carried out in EOU under Customs bond, no duty liability can be fastened in respect of such goods, inasmuch as the goods do not stand removed from the 100% EOU, which has to be considered as warehouse goods - Decided in favour of assessee. Issues Involved:1. Interpretation of exemption notification for Additional Customs Duty on HSD Oil imported by a 100% EOU.2. Application of duty liability on goods utilized by a 100% EOU for manufacturing final products.Analysis:1. The appeal dealt with the question of whether a 100% EOU was required to discharge Additional Customs Duty on HSD Oil imports as per Budget 1999 and subsequent revisions. The issue arose as Notification No.53/97-Cus exempted specified goods from Additional Customs Duty under Section 3 of the Customs Tariff Act but did not explicitly exempt HSD oil. The Commissioner favored the respondent, citing limitation and the fact that the imported HSD oil was used for manufacturing final products for export, aligning with the Tribunal's precedent that goods utilized within a 100% EOU premises do not attract duty liability as they are considered warehouse goods.2. The Tribunal referenced a prior decision in the case of M/s Paras Fab International Vs. CCE Kandla, where it was established that goods imported and utilized within a 100% EOU premises for manufacturing purposes do not incur duty liability since they are not removed from the EOU. This principle was further upheld in the case of CC Jamnagar Vs. M/s Reliance Industries Ltd. The Tribunal concluded that goods imported by a 100% EOU and used in manufacturing final products within the EOU premises are not subject to duty payment. Consequently, the appeal by the Revenue was dismissed based on the established legal precedent and the specific circumstances of the case.
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