2025 (2) TMI 140

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....e manufacture of Door Mirror, Pneumatic Mirror and Lighting & Signalling Equipments falling under Heading 70061000 and 85122010 of CETA, 1985. The department noticed that the appellant imported moulds from M/s. Ampa Industries in the year 2007 without payment of customs duties based on exemption contained in Notification No. 52/2003-Cus dated 31.3.2003. The said moulds were intended for manufacture of automotive lighting equipments and signalling equipments for two wheelers for M/s. PT TVS Motor Company, Indonesia (TVS Indonesia). The appellant during the month of March 2008, invoiced the moulds to TVS Indonesia for USD 1,91,360, they also paid an amount of Rs.2,92,192/- as VAT towards sale of the said moulds and dies considering the s....

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....me they sold the said goods to their buyers. It is revenues case that such sale on which VAT had been also discharged amounted to deemed de-bonding of the said goods. The short question which arises is whether the sale of capital goods being used within an EOU to TVS Indonesia, without physical removal can be treated as deemed debonding / removal of the goods from the EOU on which duty has to be paid. 4.1) I find that Para 6.2 (b) of FTP 2004-2009 states as under; b) An EOU / EHTP / STP / BTP unit may import and /or procure, from DTA or bonded warehouses in DTA / international exhibition held in India, without payment of duty, all types of goods, including capital goods, required for its activities, provided they are not vprohib....

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....rehouse. This shows that ownership of the goods is irrelevant for an EOU to undertake its authorized operations. In J.K. Cotton Spinning And Weaving Mills Ltd & Anr Vs Union Of India & Ors [AIR 1988 SUPREME COURT 191 / (1987) 32 ELT 234], the hon'ble Apex Court held that, "there can be no doubt that the word 'removal contemplated shifting of a thing from one place to another. In other words, it contemplates physical movement of goods from one place to another." In this case there is no shifting of the goods nor is there a deeming provision for sale or change of title to amount to removal, accordingly, sale of capital goods without physical removal from the EOU cannot be treated as deemed removal of the goods. 4.3) It has been held in....