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2019 (10) TMI 684 - AT - Central Excise100% EOU - the impugned goods were proceeded against on the premise that these goods were being cleared into the domestic tariff area on which duty liability arises under section 3 of Central Excise Act, 1944, in show cause notice issued on 12th May 1994 - HELD THAT - The appellant is a 100% export oriented unit entitled to duty-free clearance of raw materials, consumables and capital goods required for manufacture of the permitted products intended for export. The supply of impugned goods to a project funded by the International Development Agency, and against international competitive bidding is also undisputed. There is no doubt that such supplies do result in saving of foreign exchange, and for that reason, are extended the benefits of deemed export without having to leave the shores of India. However, these are prescriptions under the Export Import Policy and entitlements are restricted to the incentives enumerated therein. It is also not the case of the assessee that the central excise authorities or customs authorities are seeking to deny them the benefit granted at the time of import. In terms of Export Import Policy, the eligibility of inclusion of such clearances in the prescribed export obligation automatically derives for them the benefit of import duty exemption. The clearance have been effected to the domestic tariff area with permission accorded by the jurisdictional Development Commissioner in accordance with the prescription in the Export Import Policy. The benefits of various concessions available therein would apply if within the quantitative prescriptions in the Export Import Policy and the relevant notification - the impugned order has not examined the applicability of the said notification or the submission on the computation of the duty liability. Holding that the proviso in Section 3(1) of Central Excise Act, 1944 is applicable to the impugned goods, the matter is remanded back to the original authority for computation of the duty liability after applying eligible notifications and scrutinising the claim of the appellant to a lesser assessable value - appeal allowed by way of remand.
Issues:
1. Duty liability on supplies for a project awarded through international competitive bidding process. 2. Eligibility for deemed exports and exemption from duty liability. 3. Applicability of various notifications for duty-free clearance. 4. Interpretation of Export Import Policy and entitlements for export-oriented units. 5. Treatment of finished products under exemption notification no. 125/84-CE. 6. Chargeability under Section 3 of Central Excise Act, 1944. 7. Benefit of specific notifications for duty-free clearance. 8. Computation of duty liability and remand for further scrutiny. Analysis: 1. The appeal concerned duty liability on supplies made for a project awarded through international competitive bidding. The appellant, a 100% export-oriented unit, argued that the supplies should be considered as deemed exports and exempt from duty liability based on approvals and circulars. The Tribunal noted the undisputed facts regarding the nature of the appellant's unit and the project's funding, emphasizing the benefits of deemed exports under the Export Import Policy. 2. The Tribunal concluded that while supplies for export-oriented units are entitled to certain benefits, finished products intended for sale in India are subject to duty liability under Section 3 of the Central Excise Act, 1944. The exemption notification no. 125/84-CE exempts goods not sold in India from duty, highlighting the distinction between exports and domestic sales triggering duty liability. 3. The Tribunal discussed the applicability of specific notifications for duty-free clearance and the conditions under which such benefits could be availed. It emphasized the need for strict interpretation and adherence to the provisions of the Export Import Policy and relevant notifications for determining duty liability and exemptions. 4. Regarding the computation of duty liability, the Tribunal remanded the matter back to the original authority for further scrutiny. It directed a reevaluation of the duty liability after applying eligible notifications and assessing the appellant's claim for a lesser assessable value. The Tribunal highlighted the importance of proper examination and computation in determining the final duty liability. In conclusion, the judgment addressed the duty liability issues concerning supplies for a specific project, deemed exports, exemption notifications, and the interpretation of relevant policies and notifications. It provided detailed analysis and guidance on the application of duty exemptions and the computation of duty liability, emphasizing the need for adherence to legal provisions and strict interpretation in such matters.
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