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of <h1>Supreme Court affirms CESTAT decision on by-product classification under EoU scheme</h1> The Supreme Court upheld the decision of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) regarding the classification of by-products under ... Benefit of Notification No. 8/97 dated 01.03.1997 - Manufacture of product by 100% EOU - Held that:- Commissioner vide its Order-in-Appeal dated 26.09.1992 allowed the said appeal holding that by-products Soyabean Solvent Extraction Raw Oil was not covered under 100% EoU scheme and hence tariff rate applicable in DTA which was nil would be applicable to the by-product removed by the respondent. This finding has been upheld by the Customs, Excise and Service Tax Appellate Tribunal as well. It has affirmed the order of the Commissioner (Appeals) and dismissed the appeal of the Revenue challenging the order of the Commissioner (Appeals). - No question of law arises for consideration - Decided against Revenue. Issues:1. Classification of by-products under 100% EoU scheme2. Applicability of tariff rates in DTA3. Challenge to the order of Commissioner (Appeals)Classification of by-products under 100% EoU scheme:The respondent, engaged in manufacturing De-Oiled Cake (DoC) of various oil seeds, including soyabean, groundnut, and mustard, availed the self-removal procedure. The by-product, Soyabean Solvent Extraction Raw Oil, was cleared in DTA under Notification No. 8/97. However, a subsequent notification (No. 13/98) imposed duty at a rate of 30% as if the product was manufactured by 100% EoU. This led to the issuance of multiple show cause notices demanding duty and penalties. The Order-in-Original affirmed the demand, prompting the respondent to appeal to the Commissioner.Applicability of tariff rates in DTA:The Commissioner, in the Order-in-Appeal, held that the by-product was not covered under the 100% EoU scheme, applying a nil tariff rate applicable in DTA. This decision was upheld by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT). The CESTAT thoroughly discussed the classification issue, concluding that the by-product should be subject to the nil tariff rate in DTA. The Supreme Court, after reviewing the CESTAT's order, found no legal question requiring consideration and dismissed the appeal.Challenge to the order of Commissioner (Appeals):The Revenue challenged the Commissioner (Appeals) decision, but the CESTAT affirmed the lower authority's order. The Supreme Court, upon examination, determined that the CESTAT had adequately addressed all aspects of the classification issue, leading to the dismissal of the appeal. No legal questions were found to warrant further consideration, resulting in the rejection of the appeal.This judgment clarifies the classification of by-products under the 100% EoU scheme, the application of tariff rates in DTA, and the appellate process challenging the Commissioner's decision. The Court's decision affirms the CESTAT's findings, emphasizing the detailed analysis conducted by the lower authorities in determining the appropriate tariff treatment for the respondent's by-product.
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