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of <h1>Tribunal Upholds Duty Demand with Interest and Penalty /2003-CE</h1> <h3>M/s. Bony Polymers (P) Ltd. Versus CCE, Delhi-III </h3> M/s. Bony Polymers (P) Ltd. Versus CCE, Delhi-III - 2016 (343) E.L.T. 288 (Tri. - Del.) Issues Involved:1. Applicability of concessional rate under Notification No. 23/2003-CE for advance DTA sales.2. Similarity of goods cleared into DTA and exported goods.3. Achievement of net positive foreign exchange (NFE) earning.4. Invocation of extended period of limitation for duty demand.Issue-wise Detailed Analysis:1. Applicability of Concessional Rate under Notification No. 23/2003-CE for Advance DTA Sales:The primary issue revolves around whether the concessional rate under Notification No. 23/2003-CE applies to goods cleared into the Domestic Tariff Area (DTA) against advance DTA permission. The department contended that the concessional rate is applicable only for clearances made under sub-paras (a), (d), (e), or (g) of para 6.8 of the Foreign Trade Policy, whereas the appellant cleared goods under sub-para (k) of para 6.8, which pertains to advance DTA clearances. The Tribunal upheld this view, stating that the exemption notification does not cover advance DTA clearances under sub-para (k). The Tribunal noted that the conditions of the notification, particularly Condition (II) (b), cannot be satisfied for advance DTA clearances as they are adjusted against future DTA entitlements.2. Similarity of Goods Cleared into DTA and Exported Goods:Another contention was whether the goods cleared into DTA were similar to the goods exported, a condition for availing the concessional rate. The department argued that the appellant cleared O-rings into DTA while exporting striker bumpers and nut seals, which are different items. The Tribunal agreed with the department, observing that the condition requiring similarity of goods was not met, further disqualifying the appellant from claiming the concessional rate under the notification.3. Achievement of Net Positive Foreign Exchange (NFE) Earning:The department also argued that the appellant failed to achieve net positive foreign exchange (NFE) earning during the relevant periods (2006-2007 and 2007-2008), a prerequisite for DTA clearances at concessional rates. The Tribunal upheld this argument, noting that the appellant had negative NFE during the periods in question, which disqualified them from availing the concessional rate.4. Invocation of Extended Period of Limitation for Duty Demand:The appellant argued that the show cause notice issued on 26/3/2009 for the period October 2006 to October 2007 was time-barred and that the extended period of limitation under Section 11A (1) of the Central Excise Act was not applicable. The Tribunal rejected this argument, stating that the appellant had not disclosed the relevant facts to the department, particularly the non-fulfillment of Condition No. II of Notification No. 23/2003-CE. Consequently, the Tribunal found that the invocation of the extended period of limitation was justified.Conclusion:The Tribunal dismissed the appeal, confirming the demand for differential duty along with interest and the imposition of an equal amount of penalty under Section 11AC of the Central Excise Act. The Tribunal held that the appellant was not entitled to the concessional rate under Notification No. 23/2003-CE due to non-compliance with the specified conditions, including the type of DTA clearance, similarity of goods, and achievement of positive NFE. The extended period of limitation was also found to be rightly invoked due to the appellant's failure to disclose relevant facts to the department.
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