2023 (12) TMI 859 - AT - Customs

100% EOU eligible for duty remission on goods destroyed in fire accident under Notification 52/2003

CESTAT Chennai held that a 100% EOU was eligible for duty remission on goods destroyed in fire accident. The appellant had imported goods subject to ... 100% EOU - Remission of duty on goods destroyed in the fire - liability to pay anti-dumping duty (ADD) - eligibility for the benefit of notification No.52/2003 CUS, in respect of the materials destroyed in the fire accident. HELD THAT:- In the present case, Notification No.96/2007 CUS dated 29.08.2007, which imposes the levy of anti-dumping duty on the goods does not make any mention that it is specifically made applicable to EOU/SEZ. The second condition is that the goods imported are either cleared as such into DTA or used in the manufacture of any goods that are cleared into the DTA. The goods having been destroyed in fire, there is no occasion of the goods cleared as such into DTA or used in the manufacture of finished products for clearance into DTA - The department has relied upon Notification No.5/1994 CUS dated 18.11.1994. The said notification also states that only if the goods are cleared as such into DTA or used for manufacture of finished products and are cleared into DTA, the exemption of the notification would become ineligible. The goods imported were destroyed in fire and therefore, there is no requirement to look into the fulfilment of the conditions of Notification No.52/2003 dated 31.03.2003 - the appellant is eligible for remission of duty. Having been paid under protest, the appellant is eligible for refund. The impugned order is set aside. The appeal is allowed Issues:The issues involved in the judgment are the remission of duty on goods destroyed in a fire accident, eligibility for exemption from anti-dumping duty, and the refund claim rejection by the department.Remission of Duty:The appellant, a 100% EOU engaged in manufacturing bulk drugs, imported Ammonium Persulfate without duty payment, which got destroyed in a fire accident. The appellant requested remission of duty and paid customs duty along with interest. However, the department rejected the refund claim, stating it was time-barred and not fulfilling conditions of Notification No.52/2003 CUS. The appellant argued that the goods were destroyed within the EOU, making them eligible for remission of duty under Section 9A(2A) of the Customs Tariff Act. The department contended that the appellant did not meet the conditions of the notification and was not eligible for exemption from anti-dumping duty.Exemption from Anti-Dumping Duty:The appellant claimed that the Anti-dumping duty levied was not applicable to goods imported by an EOU as per Section 9A of the Customs Tariff Act. They argued that the imported goods, destroyed in the EOU, were not cleared in the DTA, making them eligible for a refund of the ADD paid. The department asserted that the appellant did not fulfill the conditions of Notification No.52/2003 CUS and therefore was not exempt from ADD, justifying the payment made.Refund Claim Rejection:The department rejected the refund claim of the appellant, stating that the goods were imported duty-free under Notification No.52/2003 CUS and not fulfilling the conditions, thus ineligible for exemption. The appellant paid the ADD under protest and contended that the levy was not applicable as the goods were destroyed within the EOU. The tribunal held that the appellant was eligible for remission of duty and allowed the appeal, setting aside the impugned order.Conclusion:The tribunal ruled in favor of the appellant, allowing the appeal and granting consequential reliefs. The judgment highlighted the eligibility of the appellant for remission of duty and the erroneous payment of ADD, leading to the refund claim rejection being set aside.