2015 (9) TMI 1204 - AT - Central Excise

Duty demand - SAD - appellant is availing area based exemption for VAT purposes - clearance of goods to another EOU which is in DTA - Held that - issue has been settled in appellants own case reported as 2009 (6) TMI 48 - CESTAT, NEW DELHI wherein Larger Bench of this Tribunal has held that appellant is required to pay SAD on their clearances. Therefore, on merits, the appellants have no case. We are holding that appellants are required to pay SAD on their clearance. In case when appellant is clearing the goods to another EOU, in that case appellant is required to pay SAD as there is no sale. Further, the value of goods may be taken as cum duty price. Therefore, matter required quantification of the demand against the appellant for giving these two benefits. Accordingly, we remand the matter to the adjudicating authority for quantification of the correct demand of duty payable by the appellant. Thus after granting benefit of clearance of one EOU to another EOU without SAD and the amount of goods shall be taken as cum duty price. As the issue has been settled by the Larger Bench of this Tribunal, therefore, no malafide can be attributed to the appellant therefore, penalty on the appellant is not imposable. - Decided partly in favour of assessee.

Summary

Issues involved:
1. Appellant's liability to pay SAD on clearances to another EOU while availing area-based exemption for VAT purposes.

Analysis:
The judgment dealt with the issue of an Appellant, an EOU, selling goods in the DTA and the requirement to pay SAD at the time of clearance to another EOU in the DTA while availing area-based exemption for VAT. The Tribunal referred to a previous case where it was held that the Appellant is indeed required to pay SAD on their clearances. The Tribunal reiterated this stance and ruled that the Appellant must pay SAD on their clearances, even when selling to another EOU. However, the Tribunal highlighted the need for quantification of the duty demand against the Appellant, considering the clearance of goods to another EOU without SAD and valuing the goods at cum duty price. The matter was remanded to the adjudicating authority for the correct quantification of the duty payable by the Appellant.

The Tribunal emphasized that since the issue had been settled by the Larger Bench of the Tribunal, no malafide intent could be attributed to the Appellant. Consequently, the Tribunal held that no penalty should be imposed on the Appellant. The judgment concluded by disposing of the appeals with the specified terms, providing clarity on the Appellant's liability to pay SAD on clearances to another EOU while availing area-based exemption for VAT purposes.