TaxTMI 
TaxTMI 
2024 (11) TMI 65
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.... for the raw material consumed in excess of SION norms considering that as improper accounting of imported raw material consumption. The period of dispute is from August, 2004 to March 2006. 2. The brief facts are the Appellant had imported 'Milled Glass Powder' for manufacture and export of multi form 'Bead glass' which is used in the manufacture of 'Electron Guns'. As per the provisions of the wastage norms under SION, only 4.76% of wastage is allowed. However after manufacturing, more than 4.76% of waste was generated. Alleging that the excess wastage generated over and above the permissible limits prescribed under SION norms as notified under duty exemption Scheme amounts to improper accounting of raw material consumption, the Adjudi....
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....letter No. 1/72(2) EOU CEPZ 10517 dated 15.12.2004 conveyed the approval of the Development Commissioner fixing the percentage of waste and scrap generated as 20.34% on adhoc basis for a period of 6(six) months. Thereafter, Board of Approvals (BoA) for 100% EOU in its 4th meeting held on 14.06.2005 decided that adhoc norms fixed by the Development Commissioner, Special Economic Zone to continue till regular norms are approved by the Board of Approval. However, SCN was issued demanding customs duty on the ground that as per Para 6.8(b) of the Exim Policy 2003-2007 read with Appendix 14-I of the Hand Book of Procedure and Para 6.8(e) of Foreign Trade Policy 2004-2009, the Development Commissioner is not empowered to fix the SION in respect of....
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....ate the trade. In case, any contravention by the Appellant, then the Development Commissioner would have initiated the proceedings, which were not initiated in the present case. Once Development Commissioner, who is empowered for modification of the SION norms had permitted the Appellant regarding the generation of waste in excess than the SION norms, and when not proceeded against the appellant, respondent have no jurisdiction to proceed with demand of duty. 7. The Learned Counsel further submitted that the demand under Section 65(2)(b) is on scrap and Section 72(1)(d) pertains to not duly accounted goods. Even if the waste generated is in excess than the SION norms, same cannot be considered as not accounted to the satisfaction of the ....
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....rted. 9. The Appellant also challenged the jurisdiction of the Adjudication authority. As per Circular No. 21/1995-Cus dated 10.03.1995, demand cannot be concluded without concurrence of Development Commissioner. In the present case, the stand taken by the Development Commissioner is conflicting with the finding given by the Adjudication authority. The Learned Counsel relied on the following decisions in this regard:- i. M/s Kuntal Granites Ltd., Vs. CC-2001 (132) E.L.T 214 (Tri) ii. M/s ABN Granites Ltd., Vs. CC (2001 (133) E.L.T 483 (T) iii. M/s Vishal Footwear Ltd., Vs. CC (1999 (114) E.L.T 60 (T) 10. The Learned Counsel further submitted that since the Board of Approval, which is the competent authority ....
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....d in the manufacture of export goods and generation of waste in excess of quantity fixed as per the SION is contradictory to law. 12. The Learned Counsel also submitted that the decision of the Tribunal in the matter of M/s Goodluck Garments Pvt Ltd Vs. CCE & Cus, Surat-II-(2006 (206) E.L.T 911 (Tri. Mum) was set aside by the Hon'ble High Court of Gujrat vide judgment - 2019 (365) E.L.T 893 (Guj). Learned Counsel also relied on the judgment of the Hon'ble Madras High Court in the matter of M/s IOCEE Exports Ltd Vs. Commissioner of Central Excise, Chennai - 2021 (376) E.L.T 311 (Mad). 13. Learned Counsel also submitted that as per Para 6.8(f) of EXIM Policy/Foreign Trade Policy EOU is permitted to destroy the waste with the permission ....
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....stant Development Commissioner vide letter No. 1/72(2) EOU CEPZ 10517 dated 15.12.2004, conveyed the approval of the Development Commissioner fixing the percentage of waste and scrap generated as 20.34% on adhoc basis for the period of 6(six) months. Thereafter, as evident from letter dated 05.07.2005, Board of Approvals for 100% EOU in its 4th meeting held on 14.06.2005 decided that Adhoc norms fixed by the Development Commissioner, Special Economic Zone to continue till regular norms are approved by the Board of Approval. From the above facts and considering the judgment of Hon'ble High Court of Gujrat in the matter of M/s Goodluck Garments Pvt Ltd (supra), merely if wastage is in excess of the input-output norms, without anything more, w....