TaxTMI 
TaxTMI 
2008 (11) TMI 220
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....458901 dated 25-1-03 and cleared the same availing exemption contained in DEPB Notification No. 34/97-Cus dated 7-4-97. Accordingly, DEPB credit corresponding to the basic customs duty and additional duty of customs was debited. The appellant had taken credit of additional duty of customs Rs. 3,88,894/- against debit of equal amount in the DEPB book of the importer. In upholding the demand of the Cenvat credit availed against adjustment of additional duty of customs by debit under DEPB Scheme, the Commissioner (A) had followed the decision of the Larger Bench of the Tribunal in Essar Steels Ltd. v. CC Vizag - 2004 (173) E.L.T. 239 (Tri-LB) (2004-TIOL-807-CESTAT-Delhi (LB). 2. Arguing the appeal, the Ld. Counsel for the appellants submits....
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....mption notification under the DEPI3 scheme. It was clarified that "in the case of DEPB scheme though the imports are governed by an exemption notification, the fact remains that in case of such imports the duty is debited from the DEPB scrip. Therefore, it has been decided that in the case of imports under DEPB scheme, the education cess @ 2% would also be debited from the DEPB scrip". The clarification showed that debit in the DEPB scrip of additional duty of customs was also payment of duty, it is argued. Therefore, the appellants were eligible for credit of impugned amount of additional duty of customs adjusted by debiting DEPB scrip. The impugned demand therefore, deserved to be set aside. 3. Ld. JCDR submits that the liability to th....
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....he notification embodies an incentive by allowing duty free imports of inputs required for manufacture of final products exported. The DEPB book is issued by the Directorate General of Foreign Trade (DGFT) on the basis of particulars of export of corresponding final products furnished by the customs authorities. The DGFT decides the entitlement to the credit for export of a given quantity of final products. The Exim Policy therefore, appropriately prescribes the manner in which the incentive scheme has to be implemented. DGFT defines the parameters which regulate the exemption. In para 7.4.1 of the Exim Policy at the material time, it was laid down that Cenvat credit would not be available for the additional duty of customs discharged using....
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....B scheme was suitably revised extending the exemption to additional duty of customs and deleting the restriction in the policy. The exemption to the inputs imported from additional duty of customs was made subject to the sole condition that the importer had sufficient credit in the DEPB book. Exemption from the additional duty of customs and other duties of customs leviable were thus on par in the DEPB notification. These were conscious steps intended to introduce substantive changes to the benefit received by the exporters of specified export products. 5.3 Education cess is levied as a percentage of the aggregate duties of customs barring safeguard duty and countervailing duty. In Circular No. 5/05- Cus dated 31-1-05, the CBEC clarified....