Demand - Show cause notice to be issued to EOUs/EPZ/EHTP/STP units on receipt of audit objection - Customs - Letter F. No. 307/14/2000-FTT

Demand - Show cause notice to be issued to EOUs/EPZ/EHTP/STP units on receipt of audit objection Letter F. No. 307/14/2000-FTT Dated 2-8-2002 Government of India Ministry of Finance (Department of Revenue) Central Board of Excise Customs, New Delhi I am directed to state that certain instances have come to the notice of the Board wherein, after receipt of Audit objection, protective Demand-Cum-Show cause notices have not been issued to the units functioning under EOU/EPZ/EHTP/STP schemes. In some cases, the grounds for not issuing Demand-Cum-Show cause notices are stated to be Board's Circular No. 122/95, dated 28-11-95 [1996 (81) E.L.T. T21] wherein it has been instructed that the matter involving interpretation of provisions, scope of exemption notification, etc., should be referred to the Board for examination and show cause notices should be issued only after the matter has been examined and the legal position is settled. 2. The matter has been examined. This is to clarify that the said instructions of the Board does not apply to the cases where the Audit has raised objections pointing out short-levy of duty. As such, it is reiterated that on receipt of the Audit objection, Demand-Cum-Show cause notice should be issued promptly in all cases, that is to say even in cases where the Audit's point of view is not found agreeable or the matter involves interpretation of provisions and scope of exemption notification, etc. This will help prevent demands getting time-barred. 3. Suitable instructions may be issued to all field formations to strictly comply with the above instructions. Kindly acknowledge receipt.