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2019 (4) TMI 469 - AT - Central Excise100% EOU - Exemption in case only indigenous raw material was used by a 100% EOU for manufacture of products which are sold in the DTA - Benefit of N/N. 08/97-CE dated 01.03.1997 and 23/2003-CE dated 31.03.2003 - this show cause notice pertains to demand of customs duty denying the entire benefit of exemptions available to 100% EOU on the ground that they have not fulfilled the export obligations as required - Held that - There is strong force in the arguments of the learned counsel that the issue of their entitlement to the benefit of customs exemption notifications as a 100% EOU needs to be decided first and if they are not eligible for the benefit of these exemptions then the question of benefits under excise exemption notifications applicable to 100% EOUs which are the issues in dispute in the present appeals become infructuous. Matter remitted back to the original authority to decide the show cause notice dated 22.06.2001 demanding customs duty on the capital goods and raw materials imported by the appellant - appeal allowed by way of remand.
Issues:
1. Dispute regarding exemption notifications for 100% Export Oriented Units (EOUs) under Central Excise. 2. Show cause notice for customs duty exemption for 100% EOUs. 3. Challenge of a notice for personal hearing before the Commissioner of Customs and Central Excise. Analysis: Issue 1: Dispute regarding exemption notifications for 100% Export Oriented Units (EOUs) under Central Excise: The appellant, a Central Excise registrant engaged in the manufacture of cotton yarn and cotton waste, faced a dispute concerning the denial of exemption benefits under notifications 08/97-CE dated 01.03.1997 and 23/2003-CE dated 31.03.2003. The dispute arose from the usage of only indigenous raw materials by the appellant for manufacturing products sold in the Domestic Tariff Area (DTA). The matter was adjudicated by the Commissioner, and upon appeal, it was remitted for denovo adjudication, resulting in Order-in-Original No.12/2012. The key issue was whether the appellant was liable to pay the differential duty or not. Issue 2: Show cause notice for customs duty exemption for 100% EOUs: A separate show cause notice dated 22.06.2001 was issued to the appellant, seeking to deny the customs duty exemption available to 100% EOUs and recover a significant amount. The appellant challenged a subsequent notice for a personal hearing, leading to a writ petition. The High Court directed the authority to decide the issue first and then proceed with the merit of the matter. The appellant contended that the demand for customs duty was based on their failure to fulfill export obligations as required by the notification. Issue 3: Challenge of a notice for personal hearing before the Commissioner of Customs and Central Excise: The appellant challenged a notice for a personal hearing dated 08.04.2013, arguing that no action had been taken since the previous notice in 2001. The High Court directed the concerned authority to decide the issue within three months, which was not done. Consequently, the matter was remanded back to the original adjudicating authority to decide the show cause notice demanding customs duty on imported capital goods and raw materials, followed by a decision on the appeals. In conclusion, the Tribunal remitted the matters back to the original authority without passing remarks on the merits, leaving all issues open for further adjudication.
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