9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (11) TMI 156 - AT - Central Excise100% EOU - The appellant applied to the Development Commissioner for clearance of the goods up to the extent of value of ₹ 204.66 lakhs. It seems that the letter of permission granted by the Development Commissioner allowed the appellant to clear the goods to the extent of ₹ 240.66 lakhs - Held that - The subsequent detection of mistake at the end of the Development Commissioner, on account of an audit objection raised, resulting in amendment of the certificate by him will have no bearing to the goods already cleared in terms of a proper, correct and legitimate certificate issued by the Development Commissioner issued initially. As such, it cannot be said that when the goods were cleared, the appellant was not having any valid certificate and the same were cleared against them against an invalid certificate - the said excess clearances stand adjusted against the clearances for the future period, in which case no loss to the Revenue has occurred and as such no demand would be sustainable against the assessee. Extended period of limitation - Held that - The demand raised after a period of around 8 years is hopelessly barred by limitation. Appeal allowed - decided in favor of appellant.
Issues:
1. Validity of DTA sales entitlement certificate granted by Development Commissioner. 2. Correction of typographical error in the certificate. 3. Adjustment of excess sales against future DTA entitlements. 4. Imposition of differential duty and penalty. 5. Applicability of the extended period for demand of duty. Analysis: Issue 1: Validity of DTA sales entitlement certificate The appellant, a 100% EOU, was authorized to sell products in the DTA with permission from the Development Commissioner. The initial permission allowed clearance up to ?240.66 lakhs, but a typographical error led to the correction of the certificate to ?204.66 lakhs. Despite the error, the appellant cleared goods worth ?240.66 lakhs in 2000 under the concessional duty rate specified in Notification No. 2/1995. The Tribunal held that the correction made later did not invalidate the original clearance made with a valid certificate, thus upholding the legitimacy of the transactions. Issue 2: Correction of typographical error Upon audit detection, the Development Commissioner rectified the typographical error in the certificate and reduced the entitlement to ?204.66 lakhs. The excess sales of ?36 lakhs were treated as advance DTA sales and adjusted against future entitlements. The Tribunal observed that this adjustment prevented any revenue loss, and the subsequent proposal to recover the differential duty on the excess sales was found to be without merit due to the adjustment made by the appellant. Issue 3: Adjustment of excess sales The excess sales were appropriately adjusted against future clearances, ensuring no loss to the Revenue. This adjustment was considered valid and negated the basis for demanding differential duty or imposing penalties on the appellant. The Tribunal emphasized that the adjustment against future sales was a legitimate practice that did not warrant any adverse action against the appellant. Issue 4: Imposition of differential duty and penalty The initiation of proceedings in 2008 to recover the alleged duty on excess DTA sales was met with resistance by the appellant. The Tribunal found that the demand and penalty imposed were unjustified, given the adjustment made by the appellant against future sales. Consequently, the impugned orders confirming the demand and penalty were set aside in favor of the appellant. Issue 5: Applicability of the extended period for demand The Tribunal considered the timeline of events, noting that the demand raised in 2008 for transactions dating back to 2000 was beyond the permissible period for such demands. Citing a Supreme Court precedent, the Tribunal held that the demand made after around 8 years was time-barred and, therefore, could not be sustained. As a result, the demand raised after the extended period was deemed legally untenable, leading to the appeal being allowed with consequential relief to the appellant.
|
