TaxTMI 
TaxTMI 
2015 (11) TMI 448
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....tioned clearances, they are also clearing the carpets in the DTA to certain customers, who themselves are the holders of Export Promotion Capital Goods (EPCG) licence. The EPCG licence permits the holders of such licence to import specified goods at concessional rate of customs duty, which in turn is linked to export of goods/services over a period of time and subject to number of conditions in the relevant Notifications, viz., Notification No.44/2002-Cus dated 19/04/2002 and No.55/2003- Cus dated 31/03/2003. These two notifications are meant to clear the goods at concessional rate of duty on import from abroad. EPCG licence holders can also get the EPCG licence invalidated and procure the goods from a indigenous domestic unit manufacturing the goods specified in EPCG licence and domestic manufacturers can clear the same on concessional rate of duty applicable for imported goods subject to conditions specified in Notification No.44/2002-Cus & 55/2003-CE. The crux of the present case is that the appellant cleared the goods at concessional rate of duty without ensuring that their customers i.e. EPCG licence holders submit to the department for various requirements of Notification No.....
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....etion of imports. The notification also provides that the Deputy Commissioner of Customs can extend the said period of six months. 3.2 It was further submitted that condition (3) provides the importer to produce within 30 days from the expiry of each block from the date of issue of licence or evidence to the satisfaction of the Assistant Commissioner of Customs or Deputy Commissioner of Customs showing the extent of export obligation fulfilled. Here again, the Assistant/Deputy Commissioner is empowered to extend the period. 3.3 It was further submitted that since the notification itself provides for extension of time delay in producing the installation certificate/proof of fulfillment of export obligation, delay in submission of these documents is of no consequence. In support of this contention, this Tribunal judgment in the case of J.K Corporation Ltd. 1996 (88) ELT 112 (Tri) and the Hon'ble Supreme Court decision in the case of Hotline Tele tube & Components Ltd.- order dated 16.02.1998 in Civil Appeal No. 5908 of 1998 were quoted. 3.4 It was further submitted that the appeal before the Tribunal is continuation of assessment proceedings and therefore, the documents submit....
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.... is to be executed by the EPCG Licence holder only and not by the appellant. In support of his contention, the learned senior Counsel submitted that the CBEC vide Circular No. 305/83/94-FTT dated 15.09.1994 has clarified to same effect. In the said circular it is clarified that where the end use based notification requires a bond to be given, such end use Bond can be taken from the domestic buyer treating them as if they are importers. Further in respect of clearances made to EPCG licence holders by the EOU, letter dated 21.09.2006 of Director General of Export Promotion specifically states that it is the obligation of the licence holder and not an EOU: 3.7 The Learned Senior Counsel further submitted that the presumption that the excise duty can be demanded only from manufacturer is not of universal application and is not without exception. It can be shifted to any other person by the statute, particularly with the consent/approval of the other person. In support of the said proposition, the learned Senior Counsel submitted that the Rule 196 forming Chapter X of erstwhile Central Excise Rules, 1944 prescribed similar arrangements. Further, Rule 6 of the Central Excise (Removal of....
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....ing the goods in DTA at 5% being EPCG rate. The said duty rate is indeed 'appropriate duty of excise' within the meaning of said expression used in the above said Notification. It is also submitted that total of all DTA clearance i.e. normal DTA and to EPCG customer is well within the permissible limits of 50%. It was submitted that the Commissioner has conveniently mis-read Condition No.3 of the Notification No. 52/2003-Cus. It was further submitted that the opening part of para 3 is what is relevant to present case and para 6.9 (e) of the Policy is not relevant. It was further submitted that for similar reasons duty demand on the inputs procured indigenously by denying the benefit of Notification No. 1/95-CE or 22/03-CE is not sustainable. 3.10 The learned Counsel further submitted that the supply of goods to EPCG license holder amounts to deemed export in terms of Para 8.2(c) of FTP. Further, any excise duty paid by the appellant is available as refund from the DGFT vide para 8.3(c) - Hence, entire situation is revenue neutral. 3.11 It was further submitted that clearances of carpets made to EPCG Licence holders are otherwise eligible to avail benefit of Sl. No. 2 of N....
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....ation No. 23/2003-CE subject to the condition that goods are cleared by an EOU on payment of applicable VAT/ Sale Tax as the case may be. It was submitted that the appellants have paid the applicable VAT/Sales Tax, the question of said component does not arise at all. It was also submitted that the demand of differential excise duty covering the period from April, 2007 to February, 2008 has taken into account the CV duty rate @ 16% ad valorem, which is incorrect. During the period, the effective excise duty rate is 8% ad valorem in terms of Notification No. 29/04-CE. In fact, for the period from March, 2008 to 7.12.2008, the department has taken the excise duty @ 8% ad valorem as per Notification No. 29/04-Cus. Further, from 8.12.2008 to May, 2009, excise duty rate has been taken @ 4% ad valorem by the department. 3.16 It was also submitted that the demand of differential excise duty in the show cause notices covering the period from April, 2007 to February, 2008 has not considered exemption in terms of Serial No. 2 of Notification No. 23/2003-CE, which is otherwise available to the appellants. It was submitted that the department itself has granted this exemption for the period p....
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....themselves assessed the excise duty and paid the same. Monthly Returns were filed. Invoices for clearance of the goods were issued. Hence, Rule 25(1)(a) is not attracted. Similarly, Rule 25(l)(b) deals with accounting of any excisable goods is also not attracted. Similarly, clause (c) of Rule 25 (1) is not invocable in the present case since the same is applicable only to a manufacturer conducting any activity without having any registration. This clause is also not applicable to the appellants, as they are registered with the Central Excise department. Further, Rule 25(1)(d) is not applicable as contention of department is violation of Customs Notification and not Central Excise Rules or notification. 3.19 In view of the judgment of the Hon'ble High Court of MP in the case of Universal Cable Ltd. v. UOI 1977 (1) ELT, 92, it cannot be treated as "contravention of provisions of the Central Excise Rules with an intent to evade duty" and therefore, confiscation of goods is uncalled for. Another submission made was that the Goods are not available for confiscation and therefore question of imposing redemption fine does not arise and in support of the said contention, the judgement....
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.... Court in the case of CCE v. Harichand Shri Gopal 2010 (260) ELT 3. The same judgment has been followed by this Tribunal in the case of HPCL 2014 (301) ELT 554 (T). The learned Commissioner (AR)'s main contention was that a manufacturer of excisable goods has to self assess the goods to duty on removing them from the factory. In case any condition is to be fulfilled before clearing such goods, the manufacturer making the assessment has to ensure that they are fulfilled, in case the conditions are not so fulfilled, and yet the concession/exemption is applied, the self assessment is a deliberate wrong assessment. The conditions of Rules and exemptions have to be strictly applied and followed and the words of the Notification have to be given their effect. In support of his contention, the learned AR quoted the following case laws: (a) Saraswati Sugar Mills v. CCE 2011 (270) ELT 465 (SC)(paras 7 & 8) (b) Eagle Flask Industries Ltd. 2004 (171) ELT 296 (SC) (c) Indian Aluminium Co. 1991 (55) ELT 454 (SC) (paras 3 and 5 to 8) (d) CCE v. Lloyd Insulation India 2004 (172) ELT 430 (T) (e) Steel Strips v. CCE 2011 (269) ELT 257 (T-LB) (paras 5.2 to 5.4 & 5.7 to 5.16) (f) UOI v. Jin....
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....t as prescribed - Para 2(4)-to verify installation of goods in 6 months and to consider any plea of extension of time required to install if reasons are genuine. - Para 2(5)-to ensure that DGFT does not give any block wise extension for fulfillment of EO beyond 2 years; DGFT does not regularize shortfall in EO beyond 5% and that DGFT does not extend the overall period of EO in cases where the total CIF value of licence is above Rs. 100 crores. - Para 3- to ensure that goods if re exported are identified as those exported. - Table- That the goods mentioned in the licence and which are removed/imported are those described in the Table appended. - Explanation- to ensure that the goods mentioned in the licence and which are removed/imported are as defined as Capital goods and that the Export Obligation claimed to be fulfilled is only in terms of EXPORT OBLIGATION as defined. 4.3 It was further submitted that the above mentioned conditions are mandatory conditions and until and unless the consignee is registered with the Revenue in such manner that the verification, eligibility to entitlement and fulfill all continuing obligation is possible benefit of notification cannot be exten....
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....t discharged duties can be demanded without any reference to Section 11A of Central Excise Act or Section 28 of Customs Act or any Bond/Guarantee. The AR further quoted the larger bench decision of this Tribunal in the case of Bombay Hospital Trust 2005 (188) ELT 374 (T-LB), which have been upheld by the Hon'ble High Court as reported in 2006 (201) 555 (Bom). Learned AR further submitted that the appeal against the said judgment was dismissed by the Hon'ble Supreme Court 2015 (315) ELT A26. It was further submitted that the ratio of the said judgment have been upheld in the case of Fortis Hospital Ltd. 2015 (318) ELT 551 (SC). 4.5 As far as the benefit of Notification No.30/2004-Cus for computation of CVD is concerned, the learned Commissioner (AR) submitted that as per explanation to Proviso to Section 3(1) of the CEA each duty is liable to be paid at the highest of applicable rates. It is a deeming provision for goods and makes no reference to description or class of articles. The Hon'ble Supreme Court decision in the case of IFFCO 2000 (115) ELT 11, Hansur Plywood Works 1992 (61) ELT 4 (SC), Western India Plywood 1989 (44) ELT 595 (SC) were quoted. To support his co....
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.... of Notification No.22/2003-CE and Condition 3(d)(I)(ii) &(iii) of Notification No.52/2003-Cus may be seen. It was further submitted that the provisions of para 6 of Notification No.22/2003-CE and paragraph 3 of Notification No.52/2003-Cus are not applicable because such clearances to invalidated EPCG licence holders are not covered therein and also because there is nothing which shows that such clearances of the goods were allowed to be sold in the DTA in accordance with the Foreign Trade Policy and subject to such other limitations and conditions as may be specified in this behalf..... " 4.10 It was also submitted that no permission is taken from the Development Commissioner or the AC/DC for such clearances. Further, the clearances were not made on payment of appropriate duty of Central Excise leviable under Section 3 of the Central Excise Act, 1944. If appropriate duty is not paid at the time of clearance, the conditions of the aforesaid opening paragraphs of the said Notifications mandate recovery of duty on the goods procured duty free. It was further submitted that without prejudice to other arguments, the relaxation of the said paragraphs 3 and 6, if available, could only b....
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....ame notification which is in dispute in this case. He further submitted that the ITC Ltd., case was decided by this Tribunal taking into accounts the following case laws: (i) Motiram Tolaram v. UOI 1999(112) ELT 749 (ii) Ashok Traders v. UOI 1987 (32) ELT 262 (iii) Gujarat Plastic Industries v. UOI 2003 (160) ELT 125 (iv) Priyesh Chemicals & Metals v. CCE 2000 (120) ELT 259 5.2 After noticing these decisions and also relying on the following decisions, the Supreme Court has decided the SRF case in favour of the appellant and held that Notification No. 30/04-CE and Notification No. 06/2002-CE are applicable to even imported goods. It was also submitted that in Motiram Tolaram v. UOI 1999 (112) ELT 749 (SC), the Supreme Court dealt with applicability of exemption under Notification No. 185/83-CE to imported Polyvinyl Alcohol and in view of the language employed in the said Notification, the Supreme Court in Motiram held that imported goods will not be entitled for exemption from payment of CVD, under Notification No. 185/83-CE. It was submitted that the language of the Notification No. 30/2004-CE is entirely different and that has been construed by the Supreme Court to be not ap....
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....ty of customs leviable thereon which is specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) as is in excess of the amount calculated at the rate of five percent ad valorem and from the whole of the additional duty and special additional duty leviable thereon respectively under Sections 3 and 3A of the said Customs Tariff Act. 2. The exemption contained in above paragraph, shall be 2, subject to the following conditions, namely :- (1) the goods imported are covered by a valid licence issued under the Export Promotion Capital Goods (EPCG) Scheme in terms of Chapter 5 of the Export and Import Policy permitting import of goods at the rate of five percent duty and the said licence is produced for debit by the proper officer of the customs at the time of clearance; Provided that for the import of spare parts, the validity period of the licence shall be deemed to be the period permitted for fulfilment of the export obligation in full; (2) the importer executes a bond in such form and for such sum and with such surety or security as may be specified by the Assistant Commissioner of Customs or Deputy Commissioner of Customs binding himself to fulfil export oblig....
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....ed confirming installation and use of capital goods in the importer's factory or premises, within six months from the date of completion of imports or within such extended period as the said Assistant Commissioner of Customs or Deputy Commissioner of Customs may allow : Provided that in the case of, - (i) manufacturer exporter and merchant exporter having supporting manufacturer(s) or vendor(s), (ii) import of irrigation equipment for use in contract farming for export of agricultural products, and (iii) importer rendering services. the capital goods may be installed at the factory or premises of such other person whose name and address are endorsed on the licence referred to in condition (i) and where the bond for full difference of duty, if necessary, in terms of condition (2), with a bank guarantee is executed by the importer and such other person binding themselves jointly and severally to fulfill the export obligation and all other conditions of this notification and to pay duty with interest in case of default; (5) notwithstanding anything contained in condition (3), where the Licensing Authority grants an extension of block-wise period for any block(s) or overall p....
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...., 1992 (22 of 1992) or an officer authorised by him to grant a licence under the said act. (4) "export obligation", - (i) in relation to importers other than those rendering services, means export, to a place outside India, of products manufactured with the use of capital goods imported, assembled or manufactured in terms of this notification : Provided that export obligation may also be fulfilled by (a) export of same product capable of being manufactured with the use of said capital goods; or (b) export of same product manufactured in different units of the licence holder; or (c) through third party exports made by an exporter or manufacturer on behalf of the licence holder by exporting the same product and in such cases, inter alia the Shipping bills shall indicate name of both the third party and the licence holder; or (d) making supplies of same product in terms of\sub paras (a) (b) (d) (e) (f) (g) (h) (i) and (j) of paragraph 8.2 of the Export and Import Policy; (ii) in relation to importers rendering services, means, receiving payments in freely convertible foreign currency for services rendered through the use of such capital goods. [Notification No. 44/2002-Cus., ....
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....otification. (iii) The condition No.(iii) provides for monitoring of the block-wise export obligation. The importer is expected to produce the details of the export carried out in each block year within thirty days of the completion of the block year and the AC/DC is expected to examine the same and if the export obligation of a particular block is not fulfilled the importer is expected to pay customs duty of an amount equal to that proportion of duties leviable on the goods but for the exemption. Thus, if an importer who is expected to fulfil 15% of the total export obligation in 3rd and 4th year does not fulfil the same but is able to export only 10% of the total export obligation in the first four years, it is expected that importer will pay 5% of the total duty leviable on the goods but for the exemption along with interest @ 24% per annum to the Customs department. (iv) The condition (iv) in the notification is that the capital goods imported should be installed in the importers factory or premises and a certificate to that effect from the jurisdictional AC/DC of Central Excise or an independent Chartered Engineer is required to be produced confirming installation and use ....
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....ds. Thus, the importer is required to fulfil export obligation using such capital goods and not otherwise. If an importer fulfils export obligation without use of goods imported under the said exemption notification then such goods will not be entitled to the benefit of the exemption notification No.44/2002-Cus or 55/2003-Cus. It is the duty of the AC/DC to verify that the goods cleared under the said notification are installed in the importers premises and also that the export obligation is fulfilled using the goods in question. 6.4 In case of goods imported from abroad, goods are assessed at the time of clearance from the customs, assessment can be self assessment or it can be assessed by the custom officer depending upon the goods or status of importer. In both the situations before the goods get cleared, the importer produces EPCG licence, which is examined by Customs officers executes the required bond, etc. and thereafter the customs authorities monitor various conditions mentioned in the notification. In case an EPCG licence holder decides to procure the goods from the local manufacturer instead of importing, the role of the assessment gets shifted to the factory of product....
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.... carpets, it is for the concerned jurisdictional authorities to raise the demand against such defaulters. However, it is not in dispute in the present case that the appellant has not taken any care to ensure that his customers fulfill the conditions of the notification by submitting themselves to the jurisdictional authorities along with related documents, like invalidation letter, EPCG licence, bond, along with proper sureties, etc. Since the appellant has cleared the goods without ensuring the above mentioned conditions, in our considered view, the appellants are not entitled to clear the goods with, the benefit of the said notification and liability of excise duty for such clearance and consequent assessments squarely lies on the appellant. The appellant cannot be permitted to take a stand later on that these conditions are relating to their customers; and it is for the Revenue to chase such customers and raise demands against them. In our considered view if the appellant would have ensured that his customers submit themselves to the Revenue authorities with the requisite documents and after fulfilling the conditions which are required to be fulfilled before the clearance of the....
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....The law is well settled that a person who claims exemption or concession has to establish that he is entitled to that exemption or concession. A provision providing for an exemption, concession or exception, as the case may be, has to be construed strictly with certain exceptions depending upon the settings on which the provision has been placed in the Statute and the object and purpose to be achieved. If exemption is available on complying with certain conditions, the conditions have to be complied with. The mandatory requirements of those conditions must be obeyed or fulfilled exactly, though at times, some latitude can be shown, if there is a failure to comply with some requirements which are directory in nature, the non-compliance of which would not affect the essence or substance of the notification granting exemption.. In Novopan Indian Ltd. (supra), this Court held that a person, invoking an exception or exemption provisions, to relieve him of tax liability must establish clearly that he is covered by the said provisions and, in case of doubt or ambiguity, the benefit of it must go to the State. A Constitution Bench of this Court in Hansraj Gordhandas v. H.H. Dave [1996] 2 S....
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....fficiently so as to carry out the intent for which the statute was enacted and not a mirror image type of strict compliance. Substantial compliance means "actual compliance in respect to' the substance essential to every reasonable objective of the statute" and the court should determine whether the statute has been followed sufficiently so as to carry out the intent of the statute and accomplish the reasonable objectives for which it was passed. Fiscal statute generally seeks to preserve the need to comply strictly with regulatory requirements that are important, especially when a party seeks the benefits of an exemption clause that are important. Substantial compliance of an enactment is insisted, where mandatory and directory requirements are lumped together, for In such a case, if mandatory requirements are complied with, it will be proper to say that the enactment has been substantially complied with notwithstanding the non- compliance of directory requirements. In cases where substantial compliance has been found, there has been actual compliance with the statute, albeit procedurally faulty. The doctrine of substantial compliance seeks to preserve the need to comply stric....
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....cribed was specific to Chapter X with the sole intention of maintaining separate accounts for receipt, issue and usage of duty free remitted inputs received from the supplier unit. Similarity of columns and the details furnished therein cannot be considered as substitute for not maintaining of RG-16 Register or other registers for remission of duty under Chapter X. 27. We have already indicated that, at the supplier end, no registration under Rule 174 was obtained and, no records were kept. The applicants, at the recipient end, were also legally obliged to give various declarations in the statutory forms so as to claim exemption and such declarations admittedly were not made. Non-compliance of those conditions enumerated under various rules in Chapter X of the Excise Rules and non-furnishing of various statutory forms prescribed under Chapter X, in our view, are fatal to a plea of substantial compliance land intended use. The respondents, therefore, on the facts of this case, have not succeeded in establishing the plea of "intended use" or "the substantial compliance" of the procedure set out in Chapter X so as to claim the benefit of the exemption notification dated 11 -8-1994. ....
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....held that a provision for exemption, concession or exception, as the case may be, has to be construed strictly and if the exemption is available only on complying certain conditions, the conditions have to be compiled with. In the aforesaid decision, the Constitution Bench further held that detailed procedures have been laid down in Chapter X of the Rules so as to curb the diversion and utilization of goods which are otherwise excisable and the plea of substantial compliance or intended use therefore has to be rejected. 6.9 In our view, both the judgements of Hon'ble Supreme Court are squarely applicable in the facts of present case. 6.10 Coming to various other contentions of the learned Senior Counsel for the appellant, the first contention of the learned senior Counsel is that at the time of denovo adjudication, they have produced certificate in respect of 50% of the invoices and thereafter now they have produced certificate in respect of 95% of the clearances. In our view production of these certificates at this distant point of time is of no consequence. For example the installation certificates, these were to be produced within, six months from the date of clearances, t....
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....mstances this Tribunal has taken the view that delay in filing of end use certificate can be condoned. Similarly, in the case of Hotline Teletube and Components Ltd., (supra) the appellant had cleared certain goods on execution of the end use bond. The appellant did not produce the end use certificate in time and the Revenue proceeded to recover the differential duty. The appellant thereafter produced the end use certificate and it is in these circumstances, the Hon'ble Supreme Court has taken the view. In the present case, the situation is entirely different. The appellant have not cleared the goods as per the conditions of the notification. No bond was executed. Invalidation certificate, EPCG import licence, etc. were not produced at the time of clearances of the goods to the jurisdictional authorities and after the issuance of the show-cause notice at this stage, the EODC certificate is being produced and now none of the conditions of the notification can be monitored and checked. There can be no doubt that this Tribunal can look into the documents produced in the proceedings before us. However, as mentioned earlier the bond itself has not been executed, the block-wise expor....
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....ssess the goods at the time of clearance and since the conditions of notification were not fulfilled, appellant was not entitled to clear the same availing the benefit of notification No.44/2002 & 55/2003 and under these circumstances, it is the appellant who is required to pay the duty. There can be no doubt if the appellant would have fulfilled the pre-clearance conditions and his customers would have failed in fulfilling post clearance conditions, the demands would have been raised from his customers and not from the appellant. 6.11 The learned Senior Counsel has submitted this Tribunal's decision in the case of Dynamic Twisters Pvt. Ltd., (supra), We have gone through the said judgement. In the said case, appellant's customers (who were to export the goods) has executed the bond with the Central excise authorities and in these circumstances, the Tribunal has held that duty is to be demanded from the exporters (appellant's customer) and not from the Dynamic Twisters Pvt. Ltd. Similar is the position in the case of Jay Formulation Ltd. (supra). In the present case, the appellant without ensuring that his customers executes the bond, cleared the goods and therefore, d....
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....d that even if they are required to pay the duty as demanded in the show-cause notice, the countervailing duty portion is required to be computed at nil rate of duty in view of the Hon'ble Supreme Court's decision in the case of SRF Ltd. reported in 2015 (318) ELT 607 (SC). It was also submitted that , the Division Bench of the Supreme Court has already held that the decision of the Bombay High Court in the case of Ashok Traders v. UOI in 1987 (32) ELT 262 (Bom) is not a good law. In contrast the learned Commissioner (AR) submitted that three member Division Bench of the Hon'ble Supreme Court in the case of Garden Silk Mills Ltd., v. UOI 1999 (113) ELT 358 (SC) has held the same to be a good law. It was also submitted that three member Bench of the Hon'ble Supreme Court in the case of Motiram Tolaram v. UOI in 1999 (112) ELT 749 (SC) has taken a similar view. It was further submitted that two member Division Bench of the Hon'ble Supreme Court cannot over rule the decision of the three member Bench. The learned senior Counsel, further submitted that the Hon'ble Supreme Court in the case of SRF Ltd. (supra) has also disposed of the appeal relating to ITC(CA No....
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.... which would be leviable under the Customs Act, 1962 (52 of 1962) or any other law for the time being in force, on like goods produced or manufactured outside India if imported into India, and where the said duties of customs are chargeable by reference to their value; the value of such excisable goods shall, notwithstanding anything contained in any other provision of this Act, be determined in accordance with the provisions of the Customs Act, 1962 (52 of 1962) and the Customs Tariff Act, 1975(51 of 1975). Explanation 1. - Where in respect of any such like goods, any duty of customs leviable for the time being in force is leviable at different rates, then, such duty shall, for the purposes of this proviso, be deemed to be leviable at the highest of those rates. Explanation 2. - In this proviso, - 7.2 It is seen from the proviso to said Section that in case of goods cleared by a 100% EOU to DTA the duty of excise shall be an amount equal to aggregate of the duties of Customs which would be leviable on importation of such goods. Further Explanation 1 clarifies that where in respect of any such like goods, any duty of customs leviable for the time being in force is leviable at di....
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....975 is to bring a level playing field. The said section primarily provides levy of additional duty equal to excise duty, sales tax, local taxes and other charges. This section reads as: 3.(1) Levy of additional duty equal to excise duty, sales tax, local taxes and other charges. - Any article which is imported into India shall, in addition, be liable to a duty (hereafter in this section referred to as the additional duty) equal to the excise duty for the time being leviable on a like article if produced or manufactured in India and if such excise duty on a like article is leviable at any percentage of its value, the additional duty to which the imported article shall be so liable shall be calculated at that percentage of the value of the imported article: Provided that in case of any alcoholic liquor for human consumption imported into India, the Central Government may, by notification in the Official Gazette, specify the rate of additional duty having regard to the excise duty for the time being leviable on a like alcoholic liquor produced or manufactured in different States or, if a like alcoholic liquor is not produced or manufactured in any State, then, having regard to the e....
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....ld plastic goods or packaging material, etc, There may be few big units also manufacturing household plastic goods or packaging material. In such situation, government may decide to exempt such household plastic goods or packaging goods subject to the condition that no credit of inputs is availed. Manufacturers of such down stream products will have an option either to take Cenvat Credit and pay the duty on the goods manufactured by them or not to take Cenvat credit on plastic granules, dyes, colour, etc. and also not to pay the duty on the goods manufactured. As mentioned earlier, generally these options are given in order to make thousands of small units free from maintaining records and follow excise procedures. Any manufacturer who would like to pay duty and avail Cenvat credit is allowed to do so. It would thus be seen that in such cases two rates of duty comes into play for the same goods one for the manufacturers, who are availing the Cenvat Credit and another rate for the manufacturers, who are not availing the Cenvat credit. In the case of former it may be 12% while for latter NIL or concessional rate. Even manufacturers who are in NIL rate regime would have suffered duty ....
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....lant is 100% EOU, in our view as per Explanation 1 after clause (ii) of proviso to Section 3 (1) of the Central Excise Act, since there are two rates, viz., 8% and NIL rate highest of the two i.e., 8% will be chargeable. In the case of 100% EOU due to their status as 100% EOU, they are eligible to import or procure locally yarns, colours and other chemicals without payment of duty while DTA units will be required to purchase duty paid inputs. The main benefit of second option is that manufacturer need not follow excise procedures and records and can be out of excise control while in first option if a manufacturer is exporting the goods, he will get refund of duty. Thus, in case of 100% EOU when the goods are being cleared, they are required to pay countervailing duty corresponding to the highest/normal rate of duty of 8% under Notification NO.29/2004-CE. 8.4 In fact even in the present case there was no dispute between the Revenue and the appellant about the fact that countervailing duty chargeable will be 8%. This was not an issue before original authority or in grounds of appeal. It is only during the course of the arguments, the learned Senior Counsel made an additional submiss....
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.... of the Bombay High Court in the case of 'Ashok Traders v. Union of India'[1987 (32) E.L.T. 262], wherein the Bombay High Court had held that "it is impossible to imagine a case where in respect of raw nephtha used in HOPE in the foreign country, Central Excise duty leviable under the Indian Law can be levied or paid." Thus, the CEGAT found that only those conditions could be satisfied which were possible of satisfaction and the condition which was not possible of satisfaction had to be treated as not satisfied. 7. We are of the opinion that the aforesaid reasoning is no longer good law after the judgment of this Court in 'Thermax Private Limited v. Collector of Customs (Bombay),New Customs House' [1992 (4) SCC 440 = 1992 (61) E.L.T. 352 (SC) which was affirmed by the Constitution Bench in the case of 'Hyderabad Industries Limited v. Union of India'[1999 (5) SCC 15 = 1999 (108) E.L.T. 321 (S.C.)]. In a recent judgment pronounced by this very Bench in the case of 'AIDEK Tourism Services Private Limited v. Commissioner of Customs, New Delhi' [Civil Appeal No. 2616 of 2001 - 2015 (318) E.L.T. 3 (S.C.)], the principle which was laid down in Thermax Priv....
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....available or not. We also note that in the case of SRF Ltd. (or ITC Ltd.) units were not 100% EOU and it was not a case of clearance of goods to DTA and determination of duty under clause (ii) of proviso to Section 3 (1) of the Central Excise Act reed with Section 3 (1) of the Customs Tariff Act and the two explanations under these sections. Thus, the implication of explanation given in: the Central Excise Act relating to clearance from 100% EOU as also Explanation under Section 3 (1) of the Customs Tariff Act were not the issue before the hon'ble Supreme Court. The issue was limited whether benefit of Notification No.6/2002 can be extended in case of imported goods. The hon'ble Supreme Court judgment is therefore sub-silentio on this issue. The hon'ble Supreme Court in the case of Municipal Corporation of Delhi v. Gurnam Kaur has observed as under: 11. "Pronouncements of law, which are not part of the ratio decidendi are classed as obiter dicta and are not authoritative. With all respect to the learned Judge: who passed the order in Jamna Das' case and to the learned Judge who agreed with him, we cannot concede that this Court is bound to follow it It was delivere....
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....ow raised had been deliberately passed sub-silentio by counsel in order that the point of substance might be decided. We went on to say that the point had to be decided by the earlier court before it could make the order which it did; nevertheless, since it was decided "without argument, without reference to the crucial words of the rule, and without any citation of authority", it was not binding and would not be followed. Precedents sub-silentio and without argument are of no moment This rule has ever since been followed. One of the chief reasons for the doctrine of precedent is that a matter that has once been fully argued and decided should not be allowed to be reopened. The weight accorded to dicta varies with the type of dictum. Mere casual expressions carry no weight at all. Not every passing expression of a Judge, however eminent, can be treated as an ex cathedra statement, having the weight of authority. 13. In D.R.Venkatchalam v. Dy. Transport Commr. It was observed that courts must avoid the danger of a priori determination of the meaning of a provision based on their own preconceived notions of ideological structure of scheme into which the provision to be interpreted i....
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....hese parts of the legislations. It will provide imported goods advantageous position vis-a-vis similar goods manufactured by domestic area unit. Similarly, 100% EOU will be in far advantageous position vis-a-vis DTA units while clearing the goods in DTA. In fact, such units will have double advantage. The situation would be that 100% EOU, (which are eligible to get duty free inputs) will get inputs duty free and since they have got the inputs duty free there is no question of availing the credit and at the time of clearance of the manufactured goods they will not be required to pay countervailing duty component. On the other hand, DTA units will be required to pay the excise duty on the final products (in this case carpets) and avail credit of duty on inputs or alternatively not to pay the excise duty on the final products but not avail the Cenvat credit of the excise duty already paid on various inputs used in the manufacturing process. In fact similar issue had come up before this Tribunal in the case of Hanil Era Textile Ltd. 2014 (312) ELT 324 (Tri-Mum) which was also a 100% EOU and the goods were being cleared in the DTA. In the said case, this Tribunal has observed as under: ....
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....dition. Notification No. 30/2004-C.E., on the other hand prescribes NIL rate of duty subject to the condition that no credit of duty on inputs or capital goods has been taken under the provisions of the Cenvat Credit Rules, 2004. This condition cannot be satisfied on the goods manufactured or produced outside India and imported into India as the Central Excise Law including Cenvat Credit Rules, 2004 are inapplicable there. Thus we hold that duty rates applicable will be as per Notification No. 29/2004 C.E. or any other notification (if relevant to the goods in question) and not as per Notification No. 30/2004-C.E. Further, Explanation to Section 3(1) of the Customs Tariff Act clearly mandates that where excise duty is leviable at different rates, the highest duty is to be taken. Not only, even Explanation 1 to Section 3(1) of the Central Excise Act which is specific to 100% Export Oriented Undertaking specifically mandates that where in respect of any such like goods, any duty of Customs leviable for the time being in force is leviable at different rates, then such duty shall, for the purposes of this proviso, be deemed to be leviable at the highest of those rates. We have no hesit....
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....ause notices, the benefit of notification No.2/95-CE or 23/2003-CE has already been extended and even in respect of this show cause notice, for the period covered by the said notice they are satisfying all the conditions of the notification as they have achieved NFE and clearance in the DTA (including the clearances under EPCG licence) is far less than 50% of the FOB value of the export. In support of the same, the senior Counsel has also submitted data in the tabular form indicating DTA sales permission given by Development Commissioner, DTA clearances by availing Sl.No.2 of Notification NO.23/2003-CE, DTA sales entitlement remaining and value of clearances in DTA made to EPCG holders. This table indicates that value of DTA clearances (including made to EPCG licence holder) is less than the DTA sales permission given by Development Commissioner. Learned Senior Counsel also submitted letter No.SEEPZ-SEZ/28/32/97/01-02/8006 dated 08/10/2008 from Development Commissioner, SEEPZ SEZ stating that the performance of the unit has been monitored for the block period 2003-2004 to 2007-2008 and it is confirmed that appellant have fulfilled NFE for the aforesaid period on cumulative basis. A....
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....tioned. We find that Commissioner in her adjudication order has spoken about the B-17 bond alone. In the order portion, the demand has been confirmed in terms of B-17 bond along with provisions of Section 11A. The learned Commissioner (AR) submitted the judgment of this Tribunal in the case of Endress + Hauser Flowtec (I) Pvt. Ltd. v. CCE, Aurangabad 2009 (37) ELT 598 (Tri-Mumbai) in support of the contention that B-17 bond is good enough and on the other hand the learned Senior Counsel has submitted that the decision of this Tribunal in the case of CCE v. Emcure Pharmaceuticals Ltd. 2014 (307) ELT 180 (Tri-Mum). The learned Commissioner (AR) has also submitted a copy of B-17 bond executed by the appellant. Since the Commissioner has not given any findings relating to proviso to Section 11A even though, in the final order Section 11A is mentioned. We are of the view that the matter needs to be re-examined by; the Commissioner to give specific findings whether the proviso to Section 11A could be applicable in the circumstances and also whether the B-17 bond alone is enough and there is no need to refer Section 11A. We remand the matter for this purpose both sides will be free to adv....