2005 (6) TMI 328 - AT - Central Excise

Summary

Issues:
Differential demand of Excise duty on goods produced by a 100% Export Oriented Undertaking (EOU) due to incorrect payment.

Analysis:
The judgment revolves around the confirmation of a differential demand of Excise duty on goods produced by a 100% EOU. The Commissioner (Appeals) upheld the demand, stating that as per the Proviso to Notification No. 101/93-C.E., the appellants were required to pay the duty amount not less than the excise duty leviable on like goods produced outside the EOU. The period in question was from April 1994 to August 1994, and the differential demand amounted to Rs. 14,49,718.96. The appellants, despite receiving notices, did not appear, leading to the hearing being conducted with the ld. DR and a review of relevant records and notifications.

The Notification in question, as per the judgment, exempts excisable goods produced in a 100% EOU from excess excise duty, subject to certain conditions. The correct duty payable by the appellants was determined to be Rs. 35,07,084.98 based on Notification No. 32/94 dated 1-3-1994, which fixed the tariff value for Polyester Filament Yarn. However, the appellants had only paid Rs. 20,57,366.02, leading to the differential demand. The adjudicating authority's decision to confirm the differential duty demand was supported by the clear language of the Proviso to the Notification and the content of Notification No. 32/94.

Ultimately, the Tribunal upheld the impugned order, rejecting the appeal brought forth by the appellants. The decision was based on the correct interpretation of the relevant notifications and the obligation of the appellants to pay the excise duty not less than that leviable on like goods produced outside the EOU. The judgment highlights the importance of compliance with duty payment requirements for goods produced by EOUs to avoid differential demands and potential legal consequences.