TaxTMI 
TaxTMI 
2003 (1) TMI 195
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.... dtd. 30-12-98 respectively for undertaking the said jobwork within their bonded premises for LSLL. This was as per instruction in Para 4 of the Board's Circular No. 67/98-Cus., dt. 14-9-98. This Para reads as under :- "4. Further to utilize the idle capacity of the EOU/EPZ units, it has also been decided that the EOU/EPZ units in Textiles, readymade garments, agro-processing and granite sectors may be permitted to undertake job work from the DTA units provided the finished products produced by such EOU/EPZ units will be exported directly from EOU/EPZ unit itself and these goods will not be sent back to the DTA. " (b) Readymade garments manufactured on job-work basis by the EOUs for LSLL on all Raw material supplied by them, had been removed from the bonded premises, directly to Bangalore Air Cargo Complex under 'transhipment shipping bills' and invoice/packing list of the EOUs with covering letter from the Superintendent of Customs, Customs Division, Bangalore addressed to the Assistant Commissioner of Customs, Exports, ACC, Bangalore intimating the removal of goods from the bonded warehouse to the gateway port for the purpose of export. (c) &....
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....(N.T), dtd. 1-9-1998 for All Industry Rate for Drawback, as amended and Notfn. No. 31/99-Cus. (N.T), dtd. 20-5-1999 as amended read as follows : - "2. The rates of drawback specified in the said Table shall not be applicable to export of any of the commodities/products if such commodity/product is - (a) Manufactured partly or wholly in a warehouse under section 65 of the Customs Act, 1962 (52 of 1962), (b) ...................... (c) Manufactured and/or exported by a unit licensed as hundred percent export oriented undertaking in terms of the relevant provisions of the Import and Export Policy in force......................" (c) In view of the above provisions, the duty drawback of Rs. 26,47,739/60 received by LSLL and Rs. 3,07,881/63 claimed by LSLL appeared to be inadmissible in terms of paras 2(a) and (c) to general notes of Government of India Notifications No. 67/98-Cus. (N.T.), dtd. 1-9-98 as amended and 31/99-Cus. (N.T.), dtd. 20-5-1999 as amended inasmuch as the duty drawback had been sanctioned and received in respect of goods manufactured by the bonded warehouses of M/s....
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....der Section 65 of the Customs Act, 1962 the rates of Drawback specified in the table is not applicable. In the instant case, all the raw materials required for the manufacture of readymade garments have received 100% EOUs from the DTA unit and the same have been utilized in the manufacture of garments which were exported from the EOUs. The 100% EOUs are carrying out manufacturing activity in the warehouse under Section 65 of the Customs Act, 1962. The "goods" manufactured on job work basis for M/s. Leela Scottish Lace Ltd., which have been subsequently exported under claim of duty Drawback have been manufactured wholly in the warehouse under Section 65 of the Customs Act, 1962. Hence, in terms of General Notes 2(a) of the Notification No. 67/98-Cus. (N.T.), dated 1-9-98, such "goods" manufactured on job work basis are not entitled to the Drawback claimed as per the rates prescribed in the Table under the said Notifications. (f) Duty Drawback at the rate specified in the table annexed to Notfn. No. 67/98-Cus. (N.T.), dated 1-9-98 is not applicable to "goods" manufactured by the 100% EOU and exported by a DTA unit inasmuch as clause 2(c) of the notifi....
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....gible for duty Drawback at the All Industry rates or not. It has been clearly established that M/s. Leela Scottish Lace Ltd., are not eligible for the All Industry rates of Drawback in terms of Notfn. No. 67/98-Cus. (N.T.) dtd. 1-9-98. Section 75A(2) of Customs Act read with Rule 16 of the Customs and Central Excise Duties Drawback Rules, 1995 stipulates that there should be a demand for recovering the erroneous payment of Drawback. Accordingly, demand-cum-Show Cause Notice was issued to M/s. Leela Scottish Lace Ltd., DTA Unit for recovery of the erroneous payment of Drawback under Section 75A(2) of the Customs Act, 1962 read with Rule 16 of the Customs & Central Excise Duties Drawback Rules, 1995. Therefore, the question of limitation as contended by the Advocate does not merit any consideration." (l) As regards the pending claims for shipment made during July and December 1999, he found : - "......As already discussed above, the DTA Unit is eligible for brand rate of Drawback fixed by the Drawback Directorate and Drawback would be admissible at the rates claimed by M/s. Leela Scottish Lace Ltd., in such cases. As I have already pointed ou....
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....eld by Commissioner, Bangalore is as follows : - "C.No. VIII/ 48/89/ 98-CUS. TECH Minutes of the 100% EOU Meeting held on 18-12-98 at 3.30 PM with the representatives of 100% EOUs under the chairmanship of Dr. J. Sridharan, Commissioner of Customs, Bangalore. (III) Points Raised BY M/s. K&M (Exports) Unit II Point 1) As per Para 4 of the above circular, Govt. has permitted that EOUs to utilize their idle capacity by undertaking job work of DTA unit subject to the condition that the goods so manufactured should be sent directly to the port and not to be sent back to DTA. (i) Modalities to be followed in implementing the above. (ii) Confirmation that DTA shall be the exporter who will file regular DBK shipping bill and that the DBK should be eligible for full all industry rate of drawback for such export. Reply (I) In case of EOU undertaking job work and such goods being exported, the existing procedure for removal of goods for export from an EOU to gateway ports shall be followed in this case also. (ii) The owner of the goods shall file the shipping bill and not the EOU unit (job worker). The benefits, if any, of the export shall accrue to the owner of the go....
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....eived under Section 67 by the EOU. Therefore, the fabrication activity being carried out on Raw material, goods other than 'goods deposited' under Section 60 or received under Section 67, even if carried out in the warehouse premises, would not be covered by the provisions of Section 65 to construe as manufacture of goods in a warehouse. If we do not interpret in that manner, then it would invoke, the provisions of recovery of, duty on waste and rejects etc. even on goods, which are duty paid and/or brought from dutiable Domestic Tariff Areas. Such an interpretation would render the levy of duty, on waste/rejects even on domestic duty paid raw material, if required to be removed from these premises, to levy of a Customs duty. Such levy would be not permissible, as there can be no levy on goods, removed from a warehouse for home consumption, other than those which are deposited under Section 60 or received transferred under Section 67 of the Customs Act. The Control envisaged and duty liabilities by the provisions of Chapter IX of the Customs Act, is only on imported non-duty paid goods and not on duty paid Domestic Tariff Area Goods, which may be brought into the bonded warehouse a....