Concessional duty on DTA clearances by a 100% EOU depends on policy compliance and Development Commissioner permission.

Concessional central excise duty on DTA clearances by a 100% EOU was treated as contingent on compliance with the Foreign Trade Policy and the permission framework of the Development Commissioner. Because the record showed excess clearances for one period and clearances for another period without any permission letter or evidence of authorised enhancement of DTA sales, the conditions for the exemption were not established even prima facie. The appellant therefore failed to show a prima facie case for waiver of pre-deposit, and the duty demand was directed to be deposited, with waiver of interest and penalty dependent on such deposit.

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Issues: Whether the appellant had made out a prima facie case for waiver of pre-deposit by showing eligibility to concessional central excise duty on DTA clearances made by a 100% EOU without specific permission of the Development Commissioner.

Analysis: The concession under Notification No. 23/03-CE was treated as available only when the DTA sales were in accordance with the Foreign Trade Policy and the permission framework administered by the Development Commissioner. The admitted excess clearances for one period and the clearances made for another period without any permission letter from the Development Commissioner led to the view that the conditions for the concessional rate were not established even on a prima facie basis. In the absence of evidence showing enhancement or authorisation of the permitted DTA sales, the claim that the clearances were within the policy limits and therefore eligible for exemption was not accepted at the interim stage.

Conclusion: The appellant failed to establish a prima facie case for waiver of pre-deposit and was directed to deposit the full duty demand, with waiver of interest and penalty contingent upon such deposit.

Ratio Decidendi: Exemption or concessional duty for DTA clearances by a 100% EOU must be supported by compliance with the permission and policy conditions governing such clearances, and in the absence of such compliance the benefit cannot be assumed even prima facie.

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