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TMI Blog2004 (5) TMI 360X X X X Extracts X X X X X X X X Extracts X X X X ..... l Economic Zone, for manufacture of Recycled Metal Scrap vides letter of permission no. KFTZ/IZ/1587/95/7670, dated 22-9-95 issued by the Development Commissioner, Kandla Special Economic Zone. The Development Commissioner, Kandla Special Economic Zone, approved the unit on the condition that it has to export its entire production. They are also permitted to clear the goods under Para 9A 8 of the Exim Policy against Advance Licence issued by the competent authority. 4. As per the letter of permission granted to the unit, appellants were importing various kinds of scrap such as cable scrap, compressor scrap, transformer scrap etc. These scrap goods were subjected to processes of cutting, segregating, cleaning etc. and metals such as copper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 only. The clearances took place during January-February, 2001. 6. The unit had cleared 168.608 MT of copper scrap into DTA which were valued at Rs. 1,20,39,878/- (and 186.276 MT of Copper scrap, 17.669 MT of Aluminium scrap totally valued at Rs. 1,48,44,326/- in DTA) respectively against Advance Licences availing exemption under the Notification No. 82/92-C.E., dated 27-8-92. The duty on such clearances (Central Excise duty equivalent to the aggregate duties of Customs) works out to Rs. 80,77,124/- and Rs. 96,26,632/- respectively was sought to be recovered from the unit under the provisions of Section 11A of the Central Excise Act, 1944. 7. The Deputy Commissioner confirmed the demands of Rs. 96,26,632/- and imposed penalty of Rs. 24 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2004 whereby they highlighted the main grounds. 11. I have carefully gone through the facts of the case and the various submissions advanced by the appellants. 12. The Deputy Commissioner has denied the benefit of Notification No. 82/92-C.E., dated 27-8-1992 to the appellant on the solitary ground that this Notification exempts the excisable goods produced or manufactured in 100% EOU or in a Free Trade Zone (i.e. not to Special Economic Zone ) and cleared to units holding duty free import licence against Advance Release Order issued by the licensing authority. It was observed that the aforesaid Notification does not allow benefit to a units located in the Special Economic Zone and it was only with the issuance of Notification 28/20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SEZ scheme envisages a simple and transparent policy and procedures for the promotion of exports with minimum paper work. The scheme is detailed under Paragraphs 9.30 to 9.43 of the Exim Policy and paragraphs 9.41 to 9.46 of Handbook of Procedures (Vol. 1). The most important feature of the scheme is that the SEZ area shall deemed to be a foreign territory for the purpose of duties and taxes. Therefore, goods supplied to SEZ from the Domestic Tariff Area (DTA) will be treated as deemed exports and goods brought from SEZ to DTA will be treated as imported goods. It may be seen from Paragraph 9.30 of the EXIM Policy that in any SEZ, goods may be imported/procured from DTA duty free for the purpose of manufacture of goods and services, produc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the word SEZ was used in a Central Excise notification. It may also be noted under the Central Excise Rules, 1944 Rule 2(9) continued to exist defining Kandla Free Trade Zone boundaries. On comparison it is observed that Kandla Free Trade Zone defined in Rule 2(9) of the Central Excise Rules, 1944 and the Kandla SEZ defined under Notification No. 12/2001 are having identical boundaries. Under Central Excise Rules, 1944 the Kandla Free Trade Zone continued to co-exist till 20-6-2001. It is only with the issuance of Notification No. 30/2001-C.E. (N.T.), dated 21-6-2001 that the Central Excise Rules, 1944 were superseded by the Central Excise (No. 2) Rules, 2001. Thus for the purpose of Central Excise the unit of the appellant continued to ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view that Notification No. 12/2001-C.E., dated 27-3-2001 prescribing the geographical boundary of Kandla Special Economic Zone was issued under the Central Excise Rules only on 27-3-2001 and the fact that charging Section 3 was amended on 11-5-2001, it appears that under Central Excise Rules, technically speaking, Kandla Free Trade Zone continued to co-exist till 26-3-2001 despite the fact that Ministry of Commerce had issued resolution on 1-11-2000 declaring Kandla Free Trade Zone as Kandla Special Economic Zone. Since the duty under the impugned Orders has been demanded for the period from January - February 2001 on the ground that this unit was located in Kandla Special Economic Zone and the duty has been demanded under Section 3, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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