2018 (6) TMI 1071

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.... Per: C J Mathew Three show cause notices were issued to M/s Hanil Era Textiles Ltd, a 100% export oriented scheme unit operating under the Foreign Trade Policy of the Government of India. Pertaining to the periods from April 2000 to September 2001, October 2001 to March 2003 and April 2003 to December 2003, these pertained to misuse of the facility of duty-free procurement of fuel and lubrica....

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.... for its own use and to wheel out surplus power to other units subject to payment of duties foregone on the procurement of such fuel as was attributable to power that was not used by them. The charge against the respondent was that power was sold outside without discharge of duty liability. Respondent claimed that they had procured sub-standard and unconventional inputs on which they had not avail....

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....cumstances, power could have been generated with duty-paid material. Whether these are sub-standard, as claimed by respondent, or prime, as alleged by Revenue, there is no scope for demand of duty on duty-paid inputs. 6. The notices allege that the claim of sub-standard procurement is intended to conceal procurement of inputs on paper to pass on MODVAT credit to other entities. This, if true, h....