2002 (3) TMI 118 - AT - Central Excise

Summary

Issues involved: Determination of duty liability on the removal of EPABX system under Notification 123/81-C.E. for an Export Oriented Unit (EOU) and the jurisdiction of the Assistant Collector in such cases.

Summary:
The case involved the removal of an EPABX system to an EOU without duty, under Notification 123/81-C.E. The Assistant Collector imposed duty and penalty on the manufacturer, which was challenged by the appellant. The Commissioner (Appeals) set aside the order, stating that the EPABX was covered by a valid CT-3 certificate for clearance.

The Revenue appealed, arguing that EPABX did not qualify as capital goods under the notification and duty should be paid on its removal. The Tribunal considered the submissions and noted that the EPABX was not covered under the definition of capital goods or exempted materials in the notification. The appellants had previously cleared Push Button Telephones and paid duty after a similar appeal.

The Tribunal found that the case lacked evidence on how the EPABX supplied was used for manufacturing goods by the EOU consignee. It was highlighted that duty demands under the notification should be on the consignee, not the consignor. The procedure in the notification specified that duty liability for unaccounted goods used in manufacturing for export should be verified by the Officer Incharge of the Consignee factory.

Based on these findings, the Tribunal rejected the appeal, affirming the Commissioner (Appeals) decision that the supply of goods on CT-3 was in order, and the duty liability verification was the responsibility of the Consignee factory officer.