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2019 (12) TMI 1388 - CGOVT - Customs100% EOU - Duty Drawback - allegation that the drawback amount was paid erroneously to the respondent i.e. M/s. Narendra Tea Company (100% Export Oriented Unit) - whether the drawback is admissible to a 100%/Export Oriented Unit? - HELD THAT - In the instant case Excise duty has been paid by bulk tea manufacturer and supplied to 100% EOU treating the same as deemed export . Therefore, Government is of view that the respondent by no stretch of imagination being a 100% EOU can claim drawback on export goods since drawback is not admissible to a 100% EOU unit in terms of General Notes 2(c) of C.B.E. C. Notification No. 31/1999-Cus. (N.T.), dated 20-5-1999. Thus the drawback in the instant case should have been claimed by the bulk tea manufacturer who has paid the Excise duty and supplied the impugned goods to the respondent who is a 100% EOU unit in terms of D.G.F.T. Notification No. 39(RE-1)/1997-2002, dated 22-11-2001. Hence the Commissioner (Appeals) findings that 100% EOU unit is eligible for drawback in terms of D.G.F.T. Notification No. 39 (RE-1)/1997-2002, dated 22-11-2001 is erroneous and is set aside - Revision application allowed.
Issues:
1. Eligibility of a 100% Export Oriented Unit (EOU) for drawback. 2. Interpretation of relevant notifications and policies regarding drawback claims. 3. Admissibility of drawback on goods supplied by a Domestic Tariff Area (DTA) unit to a 100% EOU. Analysis: 1. The case involved a dispute regarding the eligibility of a 100% EOU for drawback. The Commissioner of Customs (Appeals) had allowed the appeal of the respondent, a 100% EOU, setting aside the Order-in-Original confirming a demand of ?10,23,000 under Rule 16 of the Customs, Central Excise, and Service Tax Duties Drawback Rules, 1995. The respondent had claimed drawback on 22 Shipping Bills, which was initially allowed but later found to be ineligible. The respondent contended that they were eligible for drawback as they had paid Excise duty on "Bulk Tea" procured under a specific notification. 2. The revision application was filed by the Commissioner of Customs (Port) Kolkata, arguing that a 100% EOU is not eligible for drawback as per Central Board of Excise and Customs Notification No. 31/1999 (N.T.). This notification stated that drawback rates shall not apply to commodities manufactured or exported by a unit licensed as a 100% EOU. The applicant maintained that the Excise duty was paid by the bulk tea manufacturer, making the goods supplied to the 100% EOU a "deemed export" and thus not eligible for drawback. The government concurred, emphasizing that drawback is not admissible to a 100% EOU unit as per General Notes 2(c) of the notification. 3. The government's analysis highlighted the key issue of whether a 100% EOU can claim drawback on goods supplied by a DTA unit. It was clarified that the Excise duty paid on bulk tea by the manufacturer, supplied to the 100% EOU, did not entitle the EOU to claim drawback. The government's decision emphasized that the drawback should have been claimed by the bulk tea manufacturer, as the 100% EOU could not avail of drawback benefits. Consequently, the Commissioner (Appeals) decision was deemed erroneous, and the revision application filed by the Commissioner of Customs (Port) Kolkata was allowed, setting aside the earlier decision. This detailed analysis of the judgment provides a comprehensive understanding of the issues involved, the arguments presented, and the final decision rendered by the authorities regarding the eligibility of a 100% EOU for drawback claims in this particular case.
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