AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2024 (10) TMI 676
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....riod 2009-2014 of the appellants financial records noticed that the appellant has obtained Letter of Permission (LoP) dated 20.04.2005 issued by Development Commissioner, Kandla Special Economic Zone (KASEZ), Gandhidham, Kutch for manufacture of finished goods as well as by-products. The by-product included Ammonium Carbonate Liquor and Ammonium Sulphate with an obligation to export entire production excluding rejects and sales in the Domestic Tariff Area as per the provisions of EOU scheme for the period of five years from the date of commencement of commercial production. The LoP as well as the green card has been extended for the further period upto 12.03.2015. The LoP as well the export period of the appellant unit has been extended by the Development Commissioner from time to time and at the relevant time it stand extended upto 12.03.2015. The department is of the view that by-product emerging during the course of manufacture namely Ammonium Carbonate Liquor and Ammonium Sulphate cleared in DTA were not similar to the goods which were exported and therefore conditions of Para 2(ii) (a) of the Notification No. 23/2003-CE dated 31.03.2003 was contravened by the appellant thereby....
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....ion No. 23/2003-CE. It has been the contention of the learned advocate that all the facts of availment of benefit of notification 23/2003-CE dated 31.03.2003 were available before the department and therefore, the period of limitation cannot be extended to five years and no element of fraud, mis-representation, suppression of facts with intention to evade duty are present in this case. 3.1 The learned advocate vehemently argued that Commissioner (Appeals) have erroneously denied them the benefit of concessional rate of duty under Notification No. 23/2003-CE dated 31.03.2003 as the appellant has rightfully been permitted by the competent authority by a letter of permission (LoP). The appellant was also allowed permission for Domestic Tariff Area sales with reference to the goods exported in accordance with the items permitted vide LoP. It has further been submitted that the appellant sold goods on concession rate of duty of excise in Domestic Tariff Area, after fulfilling their export obligation accordance with the items permitted by broad banded LoP within the specified value cap of 50% of the exports of the goods in accordance with the items permitted vide broad banded LoP. 3.2 ....
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....the appellant cleared by-product on concessional rate of duty of excise of eligible limit, the Tribunal in the above mentioned decisions has held that Domestic Tariff Area sales were actually were allowed by the Development Commissioner as per Exim Policy. Once a LoP has allowed manufacture and export of the same as well as sale in DTA, it is wrong on the part of the department to demand full rate of excise duty denying the concessional rate of duty benefit that there is no violation of either LoP or Exim Policy. 3.5 The learned advocate also objected the imposition of penalty on Shri AK Nayak, DGM, stating that there is no evidence of Shri Nayak's involvement in willful avoidance of Central Excise duty. The appellant Shri AK Nayak was an employee of the main appellant and there was no personal gain which he could have gained by resorting to any infringement of any law with intention to evade Central Excise duty. It is vehemently argued that Adjudicating Authority as well as Commissioner (Appeals) has not applied their mind in imposing penalty under Rule 26 of Central Excise Rules, 2002. The learned advocate has relied upon the decisions of this Tribunal in the case of Shri Vinod ....
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....ected to be exported from the units during specified period of such clearances in terms of Export and Import Policy; (b) the total value of such goods being cleared under sub- paragraphs (a), (b), (d) and (h) of Paragraph of the Export and Import policy, into Domestic Tariff Area from the unit does not excess 50% of the Free on Board value of exports made during the year (starting from 1st April of the year and ending with 31 March of next by the said unit; (c) the balance of the production of the goods which are similar to such goods under clearance into Domestic Tariff Area, is exported out of India or disposed of in Domestic Tariff Area in terms of Paragraph 6.9 of the Export and Import Policy;" It is apparent from the above mentioned provisions of exemption notification that the domestic clearance of the product manufactured by 100% EOU can be cleared at concessional rate of duty as per the provisions of Para 6.8 (a) and (g) of the Foreign Trade Policy 2009-204 which reads as follows:- "Entire production of EOU / EHTP/STP/BTP units shall be exported subject to following: (a) Entire production of EOU / EHTP / STP / BTP units shall be exported subject to following: Units....
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....e of goods of 50% of FOB value of exports subject to fulfillment of positive net foreign exchange earnings, on payment of concessional rate of duty. It further stipulates that within entitlement of DTA sale, unit may sell in DTA, its products similar to goods which are exported or expected to be exported from units. It is a matter of record that the appellants have fulfilled the export obligation and only the by-products as mentioned above have been cleared at the concessional rate of duty availing benefit of Notification No. 23/2003-CE dated 31.03.2003. 5.1 We find that provisions of Para 6.8 (g) of the Foreign Trade Policy 2009-2014 specifically covers by-products which can be cleared for the Domestic Tariff Area and reads as follows:- "(g) By-products included in LoP may also be sold in DTA subject to achievement of positive NFE, on payment of applicable duties, within the overall entitlement of sub-para 6.8(a). Sale of by-products by units not entitled to DTA sales, or beyond entitlements of sub-para 6.8 (a), shall also be permissible on payment of full duties." It can be seen from the above provisions of Para 6.8 (g) of the Foreign Trade Policy that by-products can be clea....
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....oms Act cannot be used in respect of notifications issued under another enactment; that in such cases common parlance or dictionary meaning is to be applied. Secondly, we find from the green card dated 31-3-2006 issued by the Development Commissioner, MEPZ and subsequently also further revised by MEPZ/SEZ that the main products that was manufactured/exported to be turbo charger components. There is no doubt that the appellant had exported bearing housing whereas the goods to be cleared into DTA seeking benefit of Notification 23/2003 was turbo wheel assembly. While, the adjudicating authority has been at pains to cite the difference in characteristics and function of these two items, the fact remains that both of them are components of turbo charger and hence will surely fall under the broad banded term 'turbo charger components' which is the export product as per the EOU/green card issued to the appellant by the Development Commissioner. Hence when the permission granted to appellant has not listed any specific components of a turbo charger but instead has only indicated export product as 12,50,000 nos. of turbo charger component which was even subsequently enhanced to 32,00,000 n....