TaxTMI 
TaxTMI 
2005 (10) TMI 128
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....mposed equal amounts of penalties in each case as indicated hereunder : Sr. No. Appeal No. Order-in-Original No. & Date Show Cause Notice No. & Dated Amount of Duty & Penalty (Rs.) Period Finished goods 01 E/3079/02 32/Dem/2002 dated 9-9-2002 V (Ch. 54) 3-41 /Dem/ 01 dated 27-6-2001 D-7,71,222/- P-7,71,000/- Jan. to Feb 2001 Grey Fabrics (Rejects & Waste) 02 E/3080/02 30/Dem/2002 dated 26-8-2002 V (Ch. 54) 3-42/Dem/of dated 28-6-2001 D-2,69,424/- P-2,69,000/- Feb. to April 2001 Twisted Yarn (Rejects & Waste) 03 E/3081/02 33/Dem/2002 dated 9-9-2002 V (Ch. 54) 3-71 /Dem/01 dated 5-7-2001 D-8,19,800/- P-8,20,000/- Mar. to April 2001 Grey Fabrics (Rejects & Waste) 04 E/3082/02 29/Dem/2002 dated 26-8-2002 V (Ch. 54) 3-15/Dem/01 dated. 4-7-2001 D-4,54,940/- P-4,54,940/- Feb. to Aug. 2000 Polyester Twisted Yarn (Rejects & Waste) 2. The appellants attack against the findings recorded by the adjudicating authority is on two main grounds : (i) The words "50% F.O.B. value of exports" would also include deemed export under para 9.9 of the policy. (ii) In case of Rejects, Waste etc., no....
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.... exported or expected to be exported from the units during specified period of such clearances in terms of Export and Import Policy, 1st April, 1997 - 31st March, 2002; (b) the total value of such goods being cleared under paragraphs 9.9 and 9.20 of the Export and Import Policy, 1st April, 1997 - 31st March, 2002, for home consumption from the unit does not exceed 50% of the free on board value of exports made during the year (starting from 1st April of the year ending with 31st Mach of next year) by the said unit and the unit has fulfilled the minimum Net Foreign Exchange Earning as a Percentage of Exports (NFEP) prescribed in Appendix-I of the said Policy; and (c) the balance of the production of the goods which are similar to such goods under clearance for home consumption, is exported out of India or disposed of in terms of paragraph 9.10 of the Export and Import Policy, 1st April, 1997 - 31st March 2002". 6. We further note that, while the adjudicating authority has proceeded on the ground that in terms of the said third proviso, the Assistant/Deputy Commissioner is empowered to determine the quantum of D.T.A. clearance....
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....in the case of Ginni International the AC/DC had, infact exercised the powers under the said proviso and permitted clearances relying on the permission granted by the Development Commissioner. Therefore the issue of validity of AC/DC exercising the power under the third proviso did not come up before the bench for discussion because AC/DC had accepted the quantification done by the Development Commissioner and subsequently there was an attempt to reopen the matter. In the light of this subtle and critical difference on facts, the judgments cited by the appellants cannot provide assistance to them. 10. We would not have had any difficulty in accepting the propositions made by the appellants, that once competent authority viz. Development Commissioner grants a permission for D.T.A. clearance, then the Central Excise authorities are precluded from questioning its validity or correctness. The relied upon judgments, viz., (i) Ginni International (supra), (ii) Virlon Textile Mills v. CCE, Mumbai-III [2002 (139) E.L.T. 371 (Tri.-Mum.)] and (iii) Shabanam Synthetics v. CCE [2003 (152) E.L.T. 123 (T) = 2002 (53) RLT 485 (CEGAT)], do support this proposition. 10.1 However, as we ....
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....hority namely AC/DC of Central Excise, of the same aspect, cannot be treated as illegal or without the authority of law unless on facts and on legal basis such a determination is demonstrated to be incorrect. In the event the permission granted by the Development Commissioner alone is treated to be ultimate determitant of the exemption, then it has the effect of making the provisions of the third proviso redundant. As discussed above, in terms of the decisions of the Supreme Court the said interpretation has to be discarded. 11.1 Therefore, we hold that obtaining the permission from the Development Commissioner is only one of the steps and not the only step for seeking the benefit of exemption under notification No. 2/95-C.E. and the Central Excise authorities (including the Commissioner of Central Excise) are well within their legal right to determine the quantum of D.T.A. clearances etc. as provided in the third proviso to the notifications. 12. Once having reached the above conclusion the next step would be to examine as to whether or not the exclusion of the quantum of deemed exports from the value of exports in terms of Exim Policy for arriving at the quantum of D.....
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....rejects up to 5% of the value of production are permitted to be sold in the D.T.A. sale of rejects above 5% are to be approved by the Development Commissioner concerned, in consultation with the local customs authorities. Therefore we agree with the appellants that since no permission from the Development Commissioner is required in respect of clearance of waste, they are entitled to the duty concession applicable to D.T.A. clearance. 14. So far as the claim for duty concession in respect of the rejects is concerned, the clearance of rejects beyond 5% of the production value alone requires the permission of Development Commissioner in consultation with the customs authorities. We accordingly hold that, the quantities of rejects in excess of 5% of the production value cleared to D.T.A. are disentitled to the exemption. In this case no data is produced before us to indicate as to what the respective permissible and non-permissible quantities are. Therefore the matter is required to be remanded to the adjudicating authority for the limited purpose of re-quantifiaction of duty liability, by confining the benefit of D.T.A. clearance to waste without any quantity restriction and to....
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....the clearance and demand duty on the ground that the entitlement was required to be restricted to 50 of the FOB value of the physical exports. I find that the issue involved in these appeals is considered by the Tribunal in the case of Ginni International (supra) and held that as per Appendix 42 of Handbook of Procedure, the Development Commissioner of the EPZ concerned will determine the extent of the D.T.A. sale admissible and issue a goods removal authorization in terms of value and the Revenue cannot go beyond the permission and dispute the value of clearance allowed by the Competent Authority. From the facts and circumstances of the present case, I find that the ratio of the decision of the Tribunal in the case of Ginni International (supra) is fully applicable and I find no reason to take a different view as the appellant were clearing the goods to D.T.A. as per permission granted by the Development Officer. Therefore, the view taken by the Adjudicating Authority that the value of deemed exports was required to be excluded and the excise authorities are not bound by the wrong quantification of the D.T.A. clearances fixed by the Development Commissioner, is not sustainable and....