9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (8) TMI 738 - AT - Central Excise100% EOU - Payment of duty on DTA clearance under Sr. no. 3 of the notification 23/2003 CE dated 31.3.2003 - Procurement of inputs from DTA whereas suppliers were availing deemed export benefits - appellant never stated that they were aware that any supplier of inputs was availing the benefit of Para 8.3 (a) and (b) of the FTP - Invocation of extended period of limitation - Held that - In view of these amendments carried out in Notification No. 23/2003-CE rate of duty, as per Serial No. 2 of the table to this exemption, was required to be reduced by 75% for the period 01.3.2006 to 28.02.2006 and by 50% with effect from 01.3.208 - No condition so specified in this regard by DGFT has been brought to our notice. As no duty is foregone even Notification No. 23/2003-CE dated 31.3.2003, as amended, does not require execution of a bond for DTA clearances by the appellant when the same is issued under Section 5A(1) of the Central Excise Act, 1944. Main appellant has been filing duty payment returns and all intimations of receipt of inputs which are duly assessed by the jurisdictional Central Excise offices. The duty demand with respect to DTA clearance can not be recovered by enforcing B-17 bond executed by the main appellant, as exemption under Notification No. 23/2003-CE is claimed independently by the appellants and returns filed by the appellants were assessed and debonding allowed. - provisions of Section 11A of the Central Excise Act, 1944 will be applicable for demanding duty from the main appellant in case conditions of Notification No. 23/2003-CE are not fulfilled. It is observed from the statements of Director of the main appellant Ms. Neepa Mehta and Shri Darshak R. Shah that none of them ever stated that they were having knowledge that GHCL was availing the benefit of Para 8.3(a) and (b) of the FTP. It is only after being explained by the investigation that they stated that GHCL was availing the benefit of Para 8.3(a) and (b). However, there is a force in the arguments of the learned Advocate that none of the documents received by them from M/s. GHCL indicate anywhere that GHCL was availing the deemed export benefit - No copy of these DFIA licenses was furnished by the Revenue before the Bench and also there is no indication whether appellants were shown copies of these DFIA licenses during investigation to the fact that these licenses had endorsements of paragraph 8.3(a) and (b) of Foreign Trade Policy on the face of these DFIA licenses. In view of the above, extended period of five years can not be invoked against the main appellant under proviso to Section 11A of the Central Excise Act, 1944 as there is no evidence of prior knowledge and suppression with intention to evade duty on the part of the appellants. - Matter remanded back for quantification of demand for normal period - Decided in favour of assessee.
Issues Involved:
1. Validity of the corrigendum issued after the personal hearing. 2. Applicability of time limits for raising demands on DTA clearances when a general B-17 bond has been executed. 3. Invocation of the extended period of 5 years for the demand. 4. Whether the appellants contested the issue on merits before the Adjudicating authority. 5. Imposition of penalties on the appellants. Issue-wise Detailed Analysis: 1. Validity of the Corrigendum: The main show cause notice dated 14.12.2011 demanded duty of Rs. 1,33,22,958/- based on Serial No. 2 of Notification No. 23/2003-CE. The corrigendum dated 18.06.2012 revised the duty demand to Rs. 4,86,65,605/- by including additional duties at full tariff rates on DTA sales, which was not part of the original notice. The tribunal found that the corrigendum changed the basis of the original demand, thus it was not merely a correction of arithmetic error but introduced new grounds, making it invalid. 2. Applicability of Time Limits for Raising Demands: The Revenue argued that no time limit applies for raising demands on DTA clearances when a general B-17 bond is executed. However, the tribunal referred to precedents indicating that Section 11A of the Central Excise Act, 1944, applies to such demands. The tribunal held that the duty demand for DTA clearances cannot be enforced through the B-17 bond as the bond primarily covers duty-free inputs and machinery, not DTA clearances. 3. Invocation of Extended Period: The Adjudicating authority invoked the extended period on the grounds of non-disclosure by the appellants that their supplier, GHCL, availed deemed export benefits under Para 8.3(a) and (b) of the FTP. The tribunal found no evidence that the appellants were aware of GHCL availing such benefits. The documents from GHCL did not indicate deemed export benefits, and the appellants had been filing all required documents and returns. Therefore, the extended period of five years was not applicable. 4. Contesting the Issue on Merits: The Revenue argued that the appellants did not contest the merits before the Adjudicating authority. However, the tribunal noted that the appellants did contest their entitlement to the exemption under Serial No. 3 of Notification No. 23/2003-CE and provided detailed arguments in their replies. Therefore, the tribunal found that the appellants did contest the issue on merits. 5. Imposition of Penalties: Given that the extended period was not applicable and there was no evidence of intentional evasion of duty, the tribunal held that penalties were not imposable on the appellants. Conclusion: The tribunal concluded that the corrigendum dated 18.06.2012 was invalid as it changed the basis of the original demand. The demand for DTA clearances must adhere to the time limits under Section 11A of the Central Excise Act. The extended period was not applicable due to the lack of evidence of intentional evasion. The case was remanded back to the Adjudicating authority for quantification of duty after providing evidence of GHCL availing deemed export benefits under Para 8.3(a) and (b) of the FTP. The appeals were allowed to the extent indicated, and no penalties were imposed on the appellants. (Pronounced in the open Court on 11.08.2015)
|
