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TMI Blog2010 (7) TMI 440X X X X Extracts X X X X X X X X Extracts X X X X ..... Development Commissioner had issued three such letters of permission - claim for benefit under Notification No. 2/95-C.E. extending concessional rate of 50% of the aggregate duties of customs payable for such goods when imported is also not admissible as per the assessee itself when the goods are cleared under para 9.9(e) of the Exim Policy - Commissioner rightly confirmed the impugned demand along with applicable interest. The matter is remanded to the Commissioner for determining the duty liability of the assessee after allowing the cum-duty benefit to the impugned clearances. Needless to say that the assessee shall be heard before the matter is adjudicated afresh. Appeal is thus allowed by way of remand. - Penalty waived. - E/906-907/2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the letters. An EOU could make clearances in terms of the said Notification No. 8/97-C.E., if such goods were made wholly from indigenous raw materials and the EOU was allowed to sell such goods in India in accordance with provisions of sub-paras (a), (b), (c) and (f) of para 9.20 of Exim Policy 1997-2002. The assessee had short paid duty on clearances of its finished goods made during the material period by availing inadmissible exemption under Notification No.8/97-C.E. After due process of law, the Commissioner found that the EOU had availed inadmissible exemption under Notification No. 8/97-C.E. for DTA sales made under para 9.9(e) of Exim Policy. The Commissioner rejected the claim of the assessee that it was entitled to benefit of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s have been taken :- The Commissioner had erred in not considering that the permissions issued by the Development Commissioner had wrongly mentioned para 9.9(e) instead of para 9.9(b) of the Exim Policy. Para 9.9(e) of the policy were intended to allow clearances over and above 50% of the value of deemed exports. Owing to an inadvertent reference to the wrong sub-para of the Exim policy by the Development Commissioner, the Commissioner wrongly denied substantive benefit of a notification. The assessee had substantively complied with the law. The Commissioner had wrongly rejected the submission by the assessee that it had availed concession under Notification No. 8/97-C.E. only in respect of finished goods manufactured solely using indigen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he permission was given under para 9.9(e), actually the Development Commissioner had applied provisions of para 9.9 (b). The permission letters should be considered to have been issued under para 9.9(b) of the Exim Policy. 5. We note that the relevant paras of the policy read as follows :- 9.9 (a)............. 9.9(b) DTA sale up to 50% of the FOB value of exports may be made subject to payment of applicable duties and fulfillment of minimum NFEP prescribed in Appendix 1 of the policy. No DTA sale shall be permissible in respect of motor cars, alcoholic liquors and such other items as may be stipulated by Director General of Foreign Trade by a Public Notice issued in this behalf. 9.9(c) .... 9.9 (d) .......... 9.9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ught necessary amendment of the permission letter when the Development Commissioner had issued three such letters of permission. Therefore, we cannot waive the legal consequences. 7. The alternative claim for benefit under Notification No. 2/95-C.E. extending concessional rate of 50% of the aggregate duties of customs payable for such goods when imported is also not admissible as per the assessee itself when the goods are cleared under para 9.9(e) of the Exim Policy. In these circumstances, we find that the Commissioner rightly confirmed the impugned demand along with applicable interest. 8. As regards the claim for cum-duty benefit denied by the Commissioner, we find considerable merit in the claim made by the assessee. When a higher r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtin the case of Hindustan Steel Ltd. v. State ofOrissa[1978 (2) E.L.T. (J159) (S.C.)] held that penalty could not be imposed on a person just for the reason that rules provided for the same. Penalty could not be imposed unless a person was found guilty of dishonest or contumacious conduct. In the instant case, we find that the assessee and the Department believed that the impugned clearances were being made in accordance with statutory provisions. Therefore, we hold that no penalty is liable to be imposed on the assessee. The penalty imposed on the assessee is vacated. Unless the government specifically directs otherwise, when an indirect tax not discharged is found due on any transaction, the proceeds realized have to be treated as inclus ..... X X X X Extracts X X X X X X X X Extracts X X X X
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