SEZ supplies treated as Indian goods for concessional excise benefit; interpretational disputes also defeat extended limitation.

Extended limitation is not available where the dispute is interpretational and the assessee has maintained contemporaneous records, including procurement certificates and ER-2 returns, showing no suppression. Supplies from SEZ units are treated as goods produced or manufactured in India for purposes of Notification No. 23/2003-CE, because SEZ units are located within India and the notification's deeming framework does not exclude such supplies. On that basis, goods received from SEZ units satisfy the condition that raw materials be produced or manufactured in India, and the concessional benefit applies.

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Issues: (i) Whether the demand relating to procurement of inputs from other 100% EOUs was barred by limitation. (ii) Whether goods procured from SEZ units could be treated as goods manufactured in India for the purpose of availing the concessional benefit under Notification No. 23/2003-CE.

Issue (i): Whether the demand relating to procurement of inputs from other 100% EOUs was barred by limitation.

Analysis: The dispute involved an interpretational question and the appellant had maintained contemporaneous records, including procurement certificates and ER-2 returns, indicating no suppression. On the same line of reasoning adopted in the earlier decision relied upon, the extended period was not available.

Conclusion: The demand, insofar as it related to receipt of inputs from other 100% EOUs, was held to be time-barred and the appeal was allowed on that issue in favour of the assessee.

Issue (ii): Whether goods procured from SEZ units could be treated as goods manufactured in India for the purpose of availing the concessional benefit under Notification No. 23/2003-CE.

Analysis: The terms import and export under the Customs Act, the SEZ Act and the foreign trade law were read as covering goods physically brought from outside India. SEZ units are located within India, and the deeming provisions under the notification did not exclude supplies from SEZ units. Goods supplied by SEZ units were therefore treated as goods produced in India, and the condition requiring raw materials produced or manufactured in India was satisfied.

Conclusion: The appellant was entitled to the concessional benefit for goods received from SEZ units, and the demand on that count was set aside.

Final Conclusion: The impugned demands were set aside on the substantive issues decided in the appellant's favour, while one appeal was sent back for fresh consideration on the limited procedural aspect of delay.

Ratio Decidendi: Supplies from SEZ units are to be treated as goods produced in India for the purpose of a concession that applies to raw materials produced or manufactured in India, and extended limitation is unavailable where the dispute is interpretational and supported by contemporaneous statutory compliance.

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