2005 (3) TMI 548 - AT - Central Excise

Summary

Issues:
1. Interpretation of Customs Notification regarding duty rate for EPCG license goods.
2. Application of duty rate for goods cleared under EPCG license post-amendment of Customs Notification.
3. Determination of duty rate for goods cleared under Zero Customs duty EPCG licenses.

Analysis:
1. The case involved the appellant filing a Bill of Entry for debonding capital goods imported as an EOU, claiming assessment at Zero per cent duty under an EPCG license. The Commissioner (Appeals) allowed the claim, which was challenged by the Revenue in the appeal.

2. The Revenue contended that the duty rate for EPCG license goods was specified in Customs Notification No. 53/97, and post-amendment under Notification No. 56/01, a common rate of 5% was fixed for all clearances. The Revenue argued that all clearances post-amendment must be assessed at the new rate.

3. The respondent argued that goods cleared under Zero Customs duty EPCG licenses should be levied duty at Zero rate, and the revised rate should only apply to goods cleared under licenses issued after the amendment date. However, the Tribunal examined the Notification and concluded that the new rate of 5% duty applied to all clearances from the date of the amendment, regardless of the EPCG license issue date.

4. After reviewing the submissions and records, the Tribunal determined that the amendment Notification (No. 56/01) came into effect on its issue date, replacing the previous duty rates with a 5% ad valorem rate. The Tribunal emphasized that the duty rate was independent of the EPCG license issue date, and all assessments post-amendment had to be at the new rate of 5%.

5. Based on the legal interpretation that all clearances post-amendment should be assessed at 5% duty rate, the Tribunal set aside the impugned order and allowed the Revenue's appeal, emphasizing the application of the new duty rate to all clearances, regardless of the EPCG license issuance date.