2004 (4) TMI 481

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....dred per cent Export Oriented Undertaking (EOU), manufacture halogen bulbs which they were permitted to clear into Domestic Tariff Area (DTA) subject to the conditions specified in Notification No. 2/95-C.E., dated 4-1-1995; that this Notification exempts all excisable goods manufactured in a 100% EOU and allowed to be sold in India from so much of the duty of excise as is in excess of the amount calculated at the rate of fifty per cent of each of the duties of customs, which would be leviable under Section 12 of the Customs Act on the like goods manufactured outside India if imported into India; that the demand of duty has been confirmed on the ground that they were required to work out the duty liability first and thereafter 50% of the am....

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....hat after the amendment of Notification No. 2/95-C.E. by Notification No. 38/99-C.E., dated 16-9-99, the Board has issued a Circular F. No. 345/12/99-TRU, dated 24-9-99 wherein also the method of computation was illustrated; that the said Circular should be followed for the purpose of calculating the duty. 4. We have considered the submissions of both the sides. At the material time Notification No. 2/95 as amended by 38/99-C.E., dated 16-9-99 read as under:- "In exercise of the powers conferred by sub-section (1) of Section 5A of the Central Excise Act......the Central Government.......hereby exempts all excisable goods.......produced or manufactured in a hundred per cent export oriented undertaking.......and allowed to be sold ....

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....ication would be the 50% of such basic duties/auxiliary duties normally leviable. For computing the value for the purpose of determining the Additional Customs duty under Section 3 of the Customs Tariff Act, 1975, the effective chargeable basic duty/auxiliary duty is to be added to the value of the goods imported in terms of Section 14 of the Customs Act, 1962." The method of calculation followed by both the lower authorities is not correct in view of the specific wordings in the Notification No. 2/95-C.E. The Circular No. 7/2001-Cus., dated 6-2-2001 has made reference to Section 3(1) of the Central Excise Act which provides that the duty of excise leviable on excisable goods produced or manufactured by 100% EOUs and brought to any other pl....