1994 (11) TMI 148

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....and fixed on the garments exported should not have been deducted from the admissible drawback amount as was ordered by the original authority in terms of drawback Circular 9/92 issued under Ministry's circular F. No. 600/2707/92-DBK, dated 17-12-1992. The Collector also held that in the strict sense of `manufacture' under Central Excise, fixing the labels and tags to the garments does not amount to manufacture. 2. The respondents in their reply dated 13-8-1994 to the show cause notice of even no. dated 26-7-1994 have inter alia stated that there was no cause of review as Circular No. 9/92 only referred to customs Notification 219/89 (relating to duty-free import of tags, labels, etc. supplied free of charge by the buyer abroad) and not t....

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.... be seen that Note No. 2 under sub-serial No. 2707 which reduces the rate of drawback from 7.5 to 7% where tags etc. are imported under Notification No. 219/89 was issued only after the above circular and apparently incorporated the practice of Bangalore Customs into the drawback schedule. The fact that there is no related deduction enumerated in the said sub-serial number relating to Notification No. 150/80 does not limit the application of Rule 3, which, as stated above, shall have independent application. In short, therefore even if the drawback Circular No. 9/92, note under sub-serial No. 2707, both related to Notification No. 219/89 only, it is absolutely correct and permissible for Customs to make deductions as provided under Rule 3. ....