2010 (11) TMI 1066

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....in the manufacture of formulations falling under Chapter Heading 30 of CETA, 1985 and they were granted Customs Private Bonded Warehouse License. The appellant had executed bond under the provisions of the Customs Act, the Central Excise Act and the Rules and Regulations made thereunder in respect of the goods procured without payment of duty. During the period from 17.11.2005 to 31.8.2007, the appellant filed various intimations to the jurisdictional Additional Commissioner intend to clear certain raw materials procured duty free to the original suppliers as they were not conforming to the specifications. Without waiting for the approval of the Proper Officer, these goods were cleared by the appellant. Coming to a conclusion that this was ....

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....the various letters written by the assessee to the jurisdictional Assistant Commissioner indicating therein the nature of the defects and that the defective goods had been cleared under the cover of AR 3A. He draws our attention to the various AR 3A forms issued by the appellant, in respect of removal of such goods from the EOU and also re-warehousing done by the respective recipient unit. It is the submission that when the goods were received back by the original suppliers and had been warehoused as per re-warehousing certificate, the question of demand of duty does not arise. He also draws our attention to this Benchs Final Order No 61/2010 dated 28.01.2010, in the case of Dr. Reddy's Laboratories Ltd. Vs. CC & CE, Hyderabad and submits ....

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....om the Proper Officer for removal of the goods and has not discharged the duty. 5. In our considered view, the adjudicating authority has misdirected himself on the entire issue. The provisions of Para 6.17 of the Foreign Trade Policy very categorically lays down that the goods which have been procured from GTA and found to be defective, can return under Chapter X procedure of erstwhile Central Excise Rules, 1944, as per the provisions of Chapter X procedure and Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods), Rules, 2001, are para-materia. On a perusal of the evidence produced by the appellant before us, we find that the appellant had informed the jurisdictional Assistant Commissioner an....

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....ndition (8) of the impugned notification is not relevant and in any case, the same has been provided without prejudice to the Condition (6) which has been followed by the appellants. Accordingly the impugned order is set aside and the appeal is allowed." It can be seen from the above reproduced order of this Bench that the facts are identical and we have held that the condition (8) in the Notification is not relevant and if the duty-free goods are returned to the original supplier and it is added to the non-duty paid stock, the question of demanding duty does not arise. We find that the issue is covered by this Bench decision in favour of the assessee. At the same time, we are not able to ascertain the fact whether the supplier ....