TaxTMI 
TaxTMI 
2011 (2) TMI 680
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.... refer for our opinion and answering the precise four questions and we have examined the references and heard learned counsel for parties at considerable length for reaching this day to pass orders on such references :- Common four questions in TRC 1, 2 & 4/2005 "1. Whether the CEGAT has committed an error in holding that the Order-in-Original is bad as it allowed duty Drawback as per the Board Circular No. 67/1998, read with Board Circular No. 74/1999 CUS? 2. Whether the CEGAT was right in allowing the Appeal and awarding the Drawback as per All Industry Rates against the provision of Notification 67/1998, Board Circular No. 67/1998 and 74/1999? 3. Whether the respondent was eligible for Drawback as per All Industry Rate or Brand Rate? 4. Whether the order of the CEGAT runs contrary to the Rules, Circulars, Notifications and Procedures as prescribed under the Customs Act, for allowance of duty Drawback by the respondent?" Additional question in TRC No. 3/2005 : "Whether the CEGAT was right in holding that the non-mentioning of the goods being manuf....
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.... joint Commissioner in-charge of litigation and original records relating to reference Nos. TRC 1/2005, TRC 2/2005, TRC 3/2005 and TRC 4/2005, as we find we are not receiving any worthwhile assistance from the counsel appearing for the parties in these references and we are not able to answer the references. List these matters on 7-1-2010 as requested by Sri K.N. Mohan, learned standing counsel appearing for the department. Furnish a copy of this order to Sri K.N. Mohan, learned standing counsel appearing for the department for ensuring compliance." "DVSKJ/NAJ : 7-1-2010 Sri K.N. Mohan, learned Junior standing counsel appearing for the Central Excise and Customs Department, has filed a memo indicating the circumstances under which the Commissioner of Customs, Bangalore, is unable to be present before the court today and that Mr. N.K. Gupta, Joint Commissioner of Customs who is in charge of the Legal Cell of the Department is present before the court. Even after hearing the learned standing counsel on behalf of the revenue and also Mr. N.K. Gupta, Joint Commissioner of Customs, we are not in a position of appreciate as to under what circumstances and against what d....
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....rt a written submission explaining the circumstances under which and in terms of the various notification/circulars, enabled by the Central Government, duty drawback is allowed on the export on certain products, both on excise duty and customs duty that has been realised by the Governement. List this matter on 4-2-2010 as requested by the Commissioner. Commissioner to be present on the next date of hearing. Furnish a copy of this Order to Mr. K.N. Mohan, learned junior standing counsel appearing for the appellant." "DVSKJ & NAJ : 4-2-2010 Sri K.N. Mohan, learned junior standing counsel appearing for the appellant-Commissioner of Customs, has placed before us written submissions, on behalf of the appellant along with Board Circulars No. 24/2001-Cus., No. 19/2005-Cus. and No. 31/2000-Cus. and extract of Section 74 to Section 76 of the Customs Act, 1962 (52 of 1962). 2. We are still not very convinced as to the manner of working of the provisions of Section 75 and Section 76 of the Act, to allow duty drawback in respect of exported goods and in whose hands, to what extent and in what circumstances, particularly, having regard to the limitation imposed in term....
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.... Furnish a copy of this Order to Sri K.N. Mohan, learned junior standing counsel for the petitioner." "DVSKJ/NAJ : 4-3-2010 In terms of our order dated 4-2-2010, reading as under : ORDER Sri K.N. Mohan, learned junior standing counsel appearing for the appellant-Commissioner of Customs, has placed before us written submissions, on behalf of the appellant along with Board Circulars No. 24/2001-Cus., No. 19/2005-Cus. and No. 31/2000-Cus. and extract of Section 74 to Section 76 of the Customs Act, 1962 (52 of 1962). 2. We are still not very convinced as to the manner of working of the provisions of Section 75 and Section 76 of the Act, to allow duty drawback in respect of exported goods and in whose hands, to what extent and in what circumstances, particularly, having regard to the limitation imposed in terms of Rule 3 of the Customs and Excise Duties Drawback Rules, 1995, in terms of proviso to this Rules, Sub-rule (1) and (3) read in conjunction with Rule 6, Rule 8, Rule 11, Rule 13 and Rule 15 of the said Rules. 3.  Even the submission made by the Commissioner have not cleared our doubts as to whether an exporter who has not himself either import....
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....orking in practice, the object of providing duty drawbacks and the scheme visualised in the Ministry of Finance for extending benefits under the scheme, etc. 2. Mr. Pramod Kumar, Under Secretary in the Ministry of Finance, who is presently working as Technical Officer in Central Excise and Customs, Duty Drawback Division, is present before the Court. 3. Mr. Kumar has, to some extent, educated us about the duty drawback scheme, the background in which the duty drawback scheme has been introduced and as to the manner of its working, particularly in the present global context and with the agreements and the understanding that have evolved in the wake of World Trade Organisation overseeing the international trade and practices and acting like a big brother over all member states. 4. It is very obvious that our country, though a sovereign republic, has yielded to the overseeing influence and is playing tune to the dictates of such Organisations whether or not such organisations are concerned for our people or for our society nor are they familiar with the social conditions that prevail in our country. 5. Be that as it may. Though it appears to be the real....
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....xpressions of All Industry rate of drawback and brand rate of drawback with reference to statutory provisions of practicing trade has been all along to recognise distinctions between these two rates and exporter being entitled to claim duty drawback depending upon the applicability of one of the two rates; that the controversy between the parties in these references are while the revenue contends that brand rate of duty drawback, the version of the brand rate of duty drawback, the version of the assessee on the other hand is, it should be of all industry rate of drawback. However, on this aspect of the matter, learned counsel for the revenue joins issue to contend that definitely it is not that revenue concedes; that the assessee was entitled to claim brand rate of duty drawback. While the matter is heard in part, Sri Naresh Thakkar, learned counsel requests for some accommodation to look up to other statutory provisions, notifications and circulars with reference to the statutory provisions which have been made up to date relating to allowing of duty drawback and requests the matter to be listed on 28-6-2010. Our experience in these tax reference cases is that the maters ....
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.... facts for answering the questions under reference. We are expressing our dismay at the haphazard and careless manner in which the Tribunal has forwarded the statement of case without indicating the facts of the particular case relating to each reference. 2. We find, there are four references, though the export period was between 1-4-1998 to 31-3-1999, as claimed by the respondent the inputs having been procured by the respondent from different sources and having effected the exports during different periods in respect of separate claims for allowing duty drawback, therefore it is very essential that the facts in respect of each reference will have to be placed before this Court, one case cannot be decided on facts prevailing in some other case. 3. In spite of this matter being heard on several earlier occasions and being taken up specially today, and as per the request of Mr. Naresh Thakkar, learned Counsel appearing for the respondent assessee, we have not been able to conclude this matter not only for want of assistance to enlighten legal position, but also for want of basic facts which are not forthcoming and submission of Mr. Naresh Thakkar, learned Counsel for....
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....by way of transfer of the brief from another Counsel. 7. That cannot be an excuse for depriving the Court the relevant case papers and documents and getting papers. It is the responsibility of the Commissioner of customs, who has sought through these references answers to the questions posed by him to provide necessary papers which has not been provided to this court, even as admitted by learned Standing Counsel. While, we deprecate the dismal state of affairs prevailing at the office of the commissioner of customs, Queens Road, Bangalore-560 001, Karnataka, in not assisting us to answer the four references and to take a decision. We cannot help but point out to the commissioner of customs that it is his duty to provide necessary assistance and material, which is neither forthcoming in this reference nor in the other three references, we can only express our anguish at the sorry state of affairs. 8. We are therefore constrained to direct the Commissioner of customs to be present before this Court on the next date of hearing and also to ensure that the original documents be mad available and as requested by Mr. Mohan, learned Junior Standing Counsel for the revenu....
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.... disillusionment, but to no avail, as there is no commensurate response from the commission nor the counsel. Our order passed on 3-8-2010 reads as under :- Though we have made an attempt to understand the facts of present case, for which purpose, the Tribunal had submitted a statement of case as prepared and forwarded by the Tribunal, we find the statement of case sent to this Court by the Tribunal lacks necessary and basic facts for answering the questions under reference. We are expressing our dismay at the haphazard and careless manner in which the Tribunal has forwarded the statement of case without indicating the facts of the particular case relating to each reference. 2. We find, there are four references, though the export period was between 1-4-1998 to 31-3-1999, as claimed by the respondent the inputs having been procured by the respondent from different sources and having effected the exports during different periods in respect of separate claims for allowing duty drawback, therefore it is very essential that the facts in respect of each reference will have to be placed before this Court, one case cannot be decided on facts prevailing in some other case. ....
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.... 4. Whether the order of the CEGAT runs contrary to the Rules, Circulars, Notification and Procedures as prescribed under the Customs Act for allowance of duty drawback by the respondent?" 6. Mr. Mohan, learned Junior Standing Counsel for Central Excise, Customs and Service Tax, appearing on behalf of revenue in these references submits that paper book could not be filed as these cases had been entrusted to him by way of transfer of the brief from another Counsel. 7. That cannot be an excuse for depriving the Court the relevant case papers and documents and getting papers. It is the responsibility of the Commissioner of customs, who has sought through these references answers to the questions posed by him to provide necessary papers which has not been provided to this court, even as admitted by learned Standing Counsel. 8. While, we deprecate the dismal state of affairs prevailing at the office of the commissioner of customs, Queens Road, Bangalore-560 001, Karnataka, in not assisting us to answer the four references and to take a decision. We cannot help but point out to the commissioner of customs that it is his duty to provide necessary assistance an....
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.... of Finance, Department of Revenue and the Chairman, Central Board of Excise and Customs for possible remedial and reformative measures. We also express our dismay that the commissioner, who has sought these reference cases for answers to his questions arising in each response, has not been assisting or cooperating with the court for the proper disposal of these matters. It is also causing inconvenience to the respondent and its counsel due to the prolonged hearings of the reference cases, as the learned counsel for the respondent, it appears, is based at Mumbai making trips to Bangalore only for the purpose of appearing in these reference cases at the instance of Commissioner. In the circumstance, we impose a nominal cost of Rs. 5,000/- this time, payable to the respondent-assessee by the petitioner in these cases, but if adjournment are sought or become necessary again on the next date of hearing, petitioner will have to bear the actual cost incurred by the respondent. List these mattes on 17-9-2010, as requested by Sri Bhaskar, learned standing counsel for the petitioners and Sri Naresh Thacker, learned Counsel appearing for the respondent-assessee." "DVSKJ & NAJ : ....
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....the person carrying out any process or other operation to give access to every part of his manufactory to any officer of customs specially authorised in this behalf by the Assistant Commissioner of Customs or Deputy Commissioner of Customs to enable such authorised officer on inspect the processes of manufacture, process or any other operation carried out and to verify by actual check or otherwise the statements made in support of the claim for drawback. (d) For the manner and the time within which the claim for payment of drawback may be filed; Which enables the central government to make rules for effectuating the provisions of sub-section (1), providing for duty drawback, Sri Raveendran, learned ASG, appearing for the petitioners, request the matter to be taken up for further hearing on 12-11-2010 to enables the petitioners to once again look into the law and to apprise the court as to the legal position of allowing duty drawback even when the factum of goods having suffered duty earlier, is either not established or is not established as a fact before the customs authorities, as it is the version of the revenue in this case that the assessee has no....
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....wback allowed in favour of other DTAs after issue of Circular No. 67/1998 and before issue of Circular No. 31/2000 is placed before the Court, such information will support the stand of the assessee and also indicates as to how the department has treated duty drawback applications filed by DTA units similar to the respondents, during this interregnum. Mr. Raveendra, learned Additional Solicitor General submits that relevant material relating to duty drawback allowed in respect of all DTAs after the year 1995, when duty drawback rules got amended to bring it in conformity with the World Customs Organisation, will be placed before the Court, affirmed on oath by a competent officer of the Ministry of Finance and requests for time till 19-11-2010. List these matters on 19-11-2010 for further hearing". "DVSKJ/NAJ : 19-11-2010 Sri Raveendran, learned Addl. Solicitor General, appearing for the petitioners, has placed before the court an affidavit for Sri Banibrata Bhattacharya, Commissioner of Customs, Bangalore, said to be in compliance with the order passed by this court on 12-11-2010. While certain facts relating to M/s. Lela Scottish Lace Ltd. and M/s. L.T. Karle & C....
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.... two weeks and the matter may be listed on 3-12-2010. Sri Naresh Thacker agrees for such a courses of action. List the matters on 3-12-2010 for such purpose. Furnish copies of the order dated 12-11-2010 and this order to Sri Raveendran, learned Addl. Solicitor General or his colleagues free of cost." "DVSKJ & NAJ : 3-12-2010 The petitioner - Commissioner of Customs, Bangalore, has placed before the court the affidavit of Mr. Pramod Kumar, Technical Officer (Drawback), Central Board of Excise and Customs, Department of Revenue, Minsitry of Finance, New Delhi, in response to the direction that has been issued by this court on 19-11-2010 to place before the court the information regarding the amounts of duty drawback that had been allowed by the Central Government in favour of the Domestic Tariff Area Units who had claimed duty drawback in respect of goods which had been got manufactured in 100% export oriented units, but nevertheless exported either through such export oriented units on behalf of the DTA units, or got back by the DTA units and have exported the goods from their own premises. This information was called for as it was the submission on behalf of respo....
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....n to the contrary is available with them." "DVSKJ/NAJ : 16-12-2010 Sri Raveendran, learned Addl. Solicitor General, appearing for the petitioners and Sri Naresh Thacker, learned counsel appearing for the respondents submits that the matter cannot be taken up today and request to take up the matter on 7-1-2011 and if a full day's hearing is given, it is convenient for the learned counsel to complete the submissions by both sides. Registry is directed to list this matter on 7-1-2011 and since orders from the Hon'ble Chief Justice may be sought for the time at which the matter to be listed and list the matter accordingly." 6. There are two aspects which are required to be cleared before merits of the submissions and respective versions of parties can be considered. Firstly, Sri N.R. Bhaskar, learned senior Central Government standing counsel appearing for the Commissioner of Customs has drawn our attention to Misc. Cvl. 17563/2010 filed under Section 151 of Code of Civil Procedure read with Section 130A of the Customs Act for expunction of remarks contained in the orders passed by this Court on 3-8-2010 and 27-8-2010. The application is supported by the affidavit o....
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....t is immaterial as to whether the orders of the court are construed as a praise or remark reflecting on the quality of the concerned officers. 10. It is not necessary for this court to entangle with incidental aspects of this nature and to get active on such incidental aspects but not relative aspects on the orders passed on that context, however for the purpose of order, it is made clear that whatever observations contained in the orders passed by this court are not intended to reflect the performance of any individual. It is a reflection on the system, the entire administrative set-up and functioning of particular department and ministry as it is experienced in our system and society; the letharginess and irresponsibility permeates of government functioning and things are taken for granted and seldom government machinery is functioning on sound managerial functioning, more often the interest of state has suffered because of this don't care attitude or irresponsible acts of different officials at different levels. It is but natural for this Court to comment when this court has duty to perform the functions, in context of the references to be answered. The Tribunal having n....
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....ot maintainable and accordingly dismissed the appeals of the revenue at the threshold. 15. Sri Naresh Thacker, learned counsel appearing for the assessee submits that the provision of Section 130A of the Central Excise Act (sic) as it stood at relevant point of time for reference to the court from the orders passed by the Tribunal if orders involve questions of law and if for the opinion of the Tribunal that question required to be further examined and opined by the Tribunal or even if the Tribunal thinks so if the High Court on further application under very section by the aggrieved person seeks a direction to the Tribunal to refer particular question and if the High Court finds that question does merits examination by the High Court and a direction to be issued to make reference being a provision analogous to the present appeal previsions, which is one provided by the legislature on or after passing of Finance Act of 1999, the ratio is equally applicable to the references made under the very statutory provisions but for the earlier period and therefore, submission that a reference at the instance of revenue is not maintainable and there is no need for this court to go int....
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....the way of preliminary objections pressed into service by Mr. Thacker is that respondent is virtually estopped from raising such objections before us, while hearing these references, for the simple reason that it should have been raised at a point of time when this court examined the need or otherwise for directing the Tribunal to make a reference. It is also noteworthy a mention herein that even the questions we are required to answer as per this order are the very questions which are being directed by this court to be referred by the Tribunal for our answers. Therefore, there is no question of the preliminary objection coming in the way our examining merits of the present references. 19. If at all the assessee was not agreeable for this course of action, the grievance or cause of action arose when this court had directed that references be made and that order having not been questioned and further having been allowed to become final, it is not open to the assessee to rise such preliminary objection at this stage. Therefore, this preliminary objection is rejected. 20. The brief facts for the purpose of appreciating the questions required to be answered are :- Th....
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.... the form of a Book, i.e. "Duty Drawback on Exports". It is available from the Customs Department throughout the country. The highlights of the new DBK AI rates are : SAD and Special Duty Drawback The new levy of 4% Special Addl. Customs Duty has also been taken into account alongwith 5% Special Customs Duty applicable on various imported inputs, while fixing the new drawback rates. Modvat Goods The major benefit extended to all export products on which modvat is restricted to 95%. It compensates the exporters for the 5% Modvat credit which they cannot other wise avail. This removes the disability of 5%, which was making inputs costlier to exporters. Central Excise portion of All Industry Rates of Drawback equivalent to 5% of the total Central Excise allocation even where the Modvat has been claimed, will be allowed as drawback. No longer any need to produce certificate regarding non-availment of modvat availed in respect of export of handloom products, handicraft including handicraft of brass artware, finished leather, grey fabrics and other export products which are unconditionally fully exempt from Central Excise duty. Major Changes in Rates (1) &nbs....
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....ng the benefit of duty drawback, notwithstanding the goods having been manufactured in a 100% EOU or EPZ. 26. It was urged that whether or not the exported goods were manufactured inside an 100% EOU or EPZ cannot make any difference to claim the benefit provided to an exporter in terms of Section 75A of the Customs Act. 27. The Adjudicating Officer did not find merit in such contention and therefore passed four different orders dated 22-8-2002 on the four show cause notices, after considering the replies and strangely levied penalty of like amount only in adjudicating orders giving rise to reference numbers 2 & 3 and had chosen not to levy penalties in adjudication orders leading to reference numbers 1 & 4. 28. These orders were the subject matters of further appeals by the assessee before the Tribunal. The Tribunal found merit in the appeals and allowed all four appeals in terms of four different orders passed in different appeal numbers. It was the turn of the revenue to get aggrieved by the orders passed by the Tribunal and the revenue invoked the provisions of Section 130A of the Customs Act and sought for directing the tribunal to refer the questions po....
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....utilizing its idle time of machinery for want of commensurate manufacturing work relating to its own export, the two notifications referred to above came in the way of such benefit or concession of duty drawback being availed by the assessee and it is on such premise, the assessments were reopened and duty drawback claimed and received by the respondent-assessee was directed to be restored to the state. 32. While such was the view of the adjudicating authority, the Tribunal in the assessee's appeal, found that the commissioner had recorded findings on an erroneous or incorrect interpretation of the Notification No. 67 of 1998; that while the notification does come in the way of the goods manufactured in a 100% EOU claiming the benefit of duty drawback on being exported by a DTA when the goods was manufactured in the 100% EOU by availment of its idling period and spare manufacturing capacity, nevertheless for the purpose of understanding as to who is the manufacturer, for whose benefit the goods were manufactured etc., the DTA unit having supplied the raw material for getting manufactured finished products and finished products though manufactured inside a 100% EOU should ne....
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.... authorities also having found that the assessee who had claimed duty drawback on the basis that it had allowed its goods to be manufactured in a 100% EOU and EPZ on job work basis [in the instant case all three units being subsidiaries of the assessee and its sister concerns] and having not placed before the authorities any material or proof of any payment of duty in respect of the raw material (inputs) which had been sent to 100% EOU and EPZ, the assessee being not definitely entitled to claim any duty drawback, both because of the legal position and the factual position; that the Tribunal has committed a grave error in law in restoring the duty drawback in favour of the assessee in respect of the so-called exports of goods, which the assessee had claimed to have secured and manufactured in the 100% EOU and EPZ on job work basis; that the Tribunal has virtually proceeded to grant orders in favour of the assessee on assumptions and presumptions; that it is not for the tribunal to call in aid a fiction to infer that the goods though actually and factually manufactured by 100% EOU or EPZ, it should be taken to be one as manufactured by a DTA, in the light of the trade parlance that ....
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....and manufactured and/or exported by any of the units situated in the Free Trade Zones/Export Processing Zones (EPZ) as two of the subsidiaries of assessee wherein goods were manufactured or by themselves EOU and another unit where the goods are manufactured and exported are located in EPZ (M/s. Leela Lace International, Cochin). Our attention is drawn to sub-clause (c) and (d) of clause 2 of general notes of notification, relating to denial of duty drawback in certain situations to submit that irrespective of claims put forth by the assessee, assessee was not entitled to claim the benefit available in terms of Section 67A of the Customs Act or in terms of the statutory provisions of rules and notification made in terms of the rules. 40. It is therefore submitted that for the period during which these notifications held the field, assuming that the assessee had got its goods manufactured and exported through such units and assuming that inputs for the purpose of production of goods exported had suffered customs duty at some point of time, in view of the embargo in terms of the notifications, duty drawback had been wrongly availed by the assessee while filing shipping bills a....
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....ere reason of getting goods manufactured in an 100% export oriented unit, particularly as in the present case, export was not by an export oriented unit but export was on behalf of DTA though the goods were manufactured in 100% export oriented unit. Even in such an event, requirements of Section 75 of the Customs Act are fulfilled and therefore notification cannot be pressed into service to deny the benefit of duty drawback to an exporter like the assessee. 43. Sri Naresh Thacker, learned counsel appearing for the respondent assessee has evaluated his submissions to demonstrate as to how the notification cannot deny in any way the benefit of duty drawback to the assessee. The object of the notification which has to be understood in the manner as contended by the revenue, would defeat the benefit of duty drawback in terms of Section 75 of the Customs Act. 44. Mr. Naresh Thacker, learned counsel appearing for the assessee has also contended that circular issued by the Customs Department in the context of two notifications and particularly Notification No. 31/1999 operates against the revenue to contend to the contrary the contents of circular to deny the benefit of du....
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....e way or the other warranting our answer to this question and therefore we find it unnecessary to examine and answer question No. 3 reading as hereunder :- "Whether the respondent was eligible for Drawback as per All Industry Rate or Brand Rate? 50. On our pointing out this situation to the learned counsel appearing for the parties, both Sri Naresh Thacker, learned counsel appearing for the respondent-assessee and Sri N.R. Bhaskar, learned Senior Central Government Standing Counsel appearing for the revenue agree this precise question did not arise before the Tribunal and the Tribunal has not recorded by finding one way or the other. 51. Accordingly, we examine the other questions. The real question though is distributed in the three questions viz., common question in TRC Nos. 1, 2 and 4 of 2005, is one which can be put into one question as to whether the Customs Notification No. 67/1998 read with circular of even number and customs notification No. 74/1999 read with circular of even number, would come in the way of an assessee like the respondent - a DTA unit - from claiming the benefit of duty drawback available to a domestic exporter in terms of the provisions....
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....uthorised in this behalf by the Assistant Commissioner of Customs to enable such authorised officer to inspect the processes of manufacture, process or any other operation carried out and to verify by actual check or other wise the statements made in support of the claim for drawback. (d) for the manner and the time within which the claim for payment of drawback may be filed; 53. It is also fact that central government has referred the Rules known as the Customs and Central Excise Duties Drawback Rules, 1995, which though called or terms as Rules, in fact, controls and regulates the operation of the provisions of sub-section (1) of Section 75 of the Act, as is indicated as to what conditions in the ending part of the sub-section (1), reading as under : ".....the central government may, by notification in the official gazette, direct that duty drawback shall be allowed in respect of such goods, in accordance with and subject to the rules made under sub-section (2). 54. In terms of the power vested in the central government under sub-section (2) of Section 75 of the Act read with Section 37 of the Central Excise Act, 1944, the central gov....
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....n terms of notification No. 79/95-Cus., dated the 31st March, 1995 or against quantity based advance licences issued on or after 1st April, 1995 in discharge of obligation in terms of Notification No. 80/95-Cus., dated the 31st March, 1995, or against Advance Licences issued on or after 1st April, 1997 in discharge of export obligation in terms of Notification No. 31/97-Cus., dated the 1st April, 1997, drawback at the rate equivalent to Central Excise allocation of rate of drawback specified in said Table shall be admissible subject to the condition specified therein. Provided further that where in terms of the notes given under various Serial/Sub-serial Numbers the reduced rates of drawback applicable to the export made against quantity based advance licences have been specified, the said rates shall also be applicable for the exports made against quantity based advance licences issued on or before 31st March, 1995; (c) manufactured and/or exported by a unit licensed as hundred per cent export oriented undertaking in terms of the relevant provisions of the Import and Export Policy in force; (d) manufactured and/or exported by any of the units situated in the Fre....
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....embargo as is provided in clauses (1), (b), (c) and (d) of Note-2 of the two notifications. In fact we can even skip clause (b) and concentrated on clause(c), which is one relating to the consequences that befall on goods manufactured and/or exported by 100% EOU units and clause (b) relating to goods manufactured and/or exported by a unit located in an export process zone. Significance is that the respondent-DTA unit had got its goods which it claims to have exported in two of its 100% EOUs and one EPZ and therefore clauses (c) and (d) of Notes :- 2 of the two notifications, are automatically attracted and operate. 60. The language of the notifications, rule and the section, make it very clear that the benefit of duty drawback in respect of goods manufactured at a 100% EOU or EPZ unit is not available when such goods are exported as benefit of duty drawback is available only when the inputs of goods manufactured for exporting had suffered duty i.e. customs duty when imported and even assuming that some part of it has suffered excise duty. 61. Though an attempt was made on behalf of the respondent-assessee by Sri Naresh Thacker, learned counsel, by pointing out that ....
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....e exports, providing incentives to exporters by way of benefit in the form of duty drawback and providing for such benefits being with the main purpose of augmenting the foreign exchanges reserve etc., the significance of the 100% EOU undertaking in terms of the relevant provisions of export-import policy is only to the establishment of a 100% EOU in terms of the policy and nothing more and at any rate the export-import policy cannot regulate or override the provisions of the Act, Rules and the notifications issued under these statutory provisions. In fact, there is no conflict or scope for understanding in the manner as is sought to be submitted by the learned counsel for the respondent-assessee. To this effect is the view taken by the courts including the Supreme Court and the interpretation to be placed in respect of an exemption provision is well settled in law, for use to either to get confused or to take a contrary view and to put the matters beyond any semblance of doubt or controversy we may safely refer to and rely upon the observations contained in the judgment of the Supreme Court in the case of Commissioner of Central Excise, Chandigarh-I v. Mahaan Dairies [(2004) 11 SC....
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....y and tax in accordance with the procedure and in terms of the constitutional provisions! 68. Even in respect of an exemption matter, the exemption is as conferred by statute and not either as is sought to be given by courts or as is understood by courts by way of a deduction or by way of extension to similar situations. An exemption is only in respect of those circumstances and persons or groups who are specifically mentioned for the exemption and not by way of extension of similar situations or similarly placed persons or even similar goods. 69. It is of considerable significance to understand the provisions of Section 75 of the Act either for the purpose of levy of duty, customs or exercise, or for the purpose of allowing a duty drawback or refund of the levy is in respect of the goods identified in particular form and the assessee like instant assessee comes into the pictures only for the purpose of convenience of collection. 70. Likewise, the benefit of duty drawback is in respect of goods exported if a particular goods has fulfilled the requirement of exemption provision and strictly in terms of exemption provision. On a close and detailed examination ....
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....lars, notifications and procedures as prescribed under the Act. 74. Though learned counsel for the respondent-assessee has placed reliance on the decision of a Division Bench of the Madras High Court in the case of L.T. Karle (supra) to contend that in terms of the notification issued under the Rules 3 and 4 of the Duty Drawback Rules read with Sections 74, 75 and 76 of the Act and on a harmonious reading of the circulars notification and the statutory provisions and on a reasonable construction of the statutory provisions, the benefit of duty drawback should be given in similar situations, with great respect, we are unable to subscribe to this view and we beg to differ, for the reasons we have already indicated above. In our considered opinion, there is no need to further discuss the details of the judgment in L.T. Karle case, more particularly as the judgment is only of persuasive value and we have, with respect, unable to agree with the reasoning and the line of logic found in judgment of L.T. Karle. 75. Question No. 4 arises in TRC No. 2 and 3 of 2005 and it relates to the justification or otherwise of the levy of penalty on the assess on the premise that it amo....
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....y any EOU or and an EPZ Unit, or from a bond under Section 65, would amount to a misdeclaration. We would consider, that in not scoring out the clauses (f), (g) and (h) in the declaration on the Shipping bills would show the bona fide of M/s. LSLL and their belief at the time of export. The statement of various persons notwithstanding, since those statements are interpretation of the deponents, and not the correct position of law, as to the owner, manufacturer and exporter of the subject goods. Therefore, not scoring the clauses, which have been held to be a cause for invoking liability for confiscation in para 73 of the impugned order, cannot be upheld. Once, liability for confiscation under Section 113(i) is not found, as also there is no other allegation of mis-delcaration of material facts about description, value and quantity of the goods under export, the penal clause under Section 114(iii) as invoked and applied on the exporter and the other appellant viz., M/s. LSLL cannot be upheld. we find the reasoning given by the Tribunal for reversing the view taken by the adjudicating authority to be very strange to comment in a mild manner, as the reasoning is no reason and does ....