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TMI Blog2011 (5) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... 85021310 of the Central Excise Tariff Act, 1985. Pursuant to the information received by the department about non-reversal of an amount equivalent to 10 per cent of the value of the goods in their CENVAT credit account in relation to the goods cleared to SEZ Developers/Co-Developers, the records including sales invoices, ER-1 returns, ARE-1 etc. of the appellants were scrutinized and it was revealed that the appellants had not complied with the requirements of the provisions of the said Rules and hence pursuant to the investigation carried out, a show cause notice dated 24-2-2008 in relation to the period from June 2007 to September 2007 came to be issued to the appellants. The same was contested by filing reply dated 8-12-2008. The adjudicating authority rejected the contentions which were sought to be raised by the appellants, and ordered recovery as stated above. The Commissioner (Appeals) refused to interfere in the said order. 4. In support of the application for waiver of the requirement of pre-deposit of the amount demanded under the impugned order, while assailing the orders passed by the lower authorities, the learned Advocate submitted that the claim of the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is further submitted by the learned Advocate that the show cause notice in the matter in hand was issued only on 24-11-2008 in relation to the period from June 2007 to September 2007, which was much beyond the period of one year and hence it is barred by limitation. He has further submitted that there was no case for invoking the extended period of limitation. It is also sought to be contended that the matter being related to interpretation of law, the question of imposition of penalty does not arise. 5. On the other hand, the DR placing reliance in the decision of the Gujarat High Court in the matter of Essar Steel Ltd. v. Union of India 2010 (249) ELT 3 and the order of the Apex Court in SLP No. 5698 of 2010, dated 12-7-2010, submitted that the SLP against the said order was dismissed and considering the said decision, it cannot be said that supply to the developer of a SEZ Unit amounts to export of goods. Reliance has also been placed in the decision of the Apex Court in the matter of Zile Singh v. State of Haryana AIR 2004 (SC) 5100. It was also submitted on behalf of the department that the authorities below having taken into consideration all the relevant facts and havin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... container depots' have been added. The last two words in the category of seaport, namely, "Tuticorin and Vishakhapatnam" had been substituted by the words "Tuticorin, Vishakhapatnam and Kakinada. Similarly the last two words, namely, Ludhiana and Hyderabad" in the category of inland container depot had been substituted by the words "Ludhiana, Hyderabad, Nagpur, Agra, Faridabad, Jaipur, Guntur and Varanasi. It, therefore, cannot be said to be a case where some other seaports or inland container depots have been added for the purpose of extension of the benefit but the newly added seaports or inland container depots had been made a part of the original notification. The Union of India while making a subordinate legislation had advisedly used the word "substitution" in place of the word "addition". The object and purport of the subsequent notification issued by the Union of India was, thus, to grant the same benefit which had been granted to the exporters who were registered at the other seaports, airports or inland container depots as specified in the notification dated 7-4-1997 but also to those exporters, who had been exporting from such seaports or inland depots as specified in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the learned single Member in Sharman Fabrics case (supra) does not disclose this relevant aspect of the decision having been noted. The entire decision in Sharman Fabrics case (supra) is based on the scope of the word "substitute" as is found from the dictionary meaning which was analysed by the Apex Court in Indian Tobacco Association case (supra) and based on that it was concluded that the substitution would result in retrospective operation of the amended provision. With utmost respect, we are unable to agree with the said view taken by the learned single Member, apart from the fact that the decision being of learned single Member cannot be binding upon the Division Bench. As regards the order passed by the Tribunal in Surya Roshni Ltd. case (supra) to which one of us was party (Mr. Justice R.M.S. Khandeparkar), the order was undoubtedly in stay application and further that the stay therein was granted only on the ground that the matter was required to be referred to the Larger Bench on account of the view taken by the earlier Bench was not being acceptable to the Division Bench delivering the order in Surya Roshni Ltd. case (supra). Undisputedly, thereafter the Larger Bench ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e retrospectively operative, it is difficult to accept the contention sought to be canvassed on behalf of the appellants. 15. The decision in Zile Singh case (supra) clearly recorded that the retrospectivity of a provision is not to be presumed and rather there is presumption against retrospectivity. It was sought to be contended on behalf of the appellants that the same decision was in relation to the statutory provisions and not regarding subordinate legislation. The contention is totally devoid of substance. It is thoroughly unacceptable that if a presumption applies of the statutory provision, that the contrary presumption would apply to a subordinate legislation. Nothing has been placed on record to show that addition of SEZ Developer to be the beneficiaries under the provisions of Rule 6(6) of the said Rules was by way on account of any omission in the earlier Notification. Extension of a benefit by addition of certain grounds cannot be construed itself to be retrospective in operation. Rather the person claiming retrospectivity has to establish the same by placing on record cogent materials in support of such contention and in the absence thereof, the presumption as stated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ters of India. Therefore, the taxable event contemplated under the Customs Act, 1962 for the purpose of levy of Export Duty is taking the goods out of the territorial waters of India to a place outside India, in which case the goods would be dutiable goods as contemplated under section 12 of the said Act and attract levy of export duty, to be paid at the time of exportation of such goods. Export under the Customs Act, 1962, therefore, can be said to have taken place only upon movement of the goods outside the territorial waters of India. Reference is made to the decision of the Apex Court in the case of Union of India v. Rajindra Dyeing and Printing Mills Ltd. 2005 (180) E.L.T. 433 (S.C.)/(2004) 10 SCC 187. 41.1-3 In the absence of any amendment of the definitions of the terms "Export" and "India" in the Customs Act, 1962, or any amendment in the charging section i.e. section 12 or insertion of a charging provision contemplating movement of goods from the Domestic Tariff Area to the Special Economic Zone as a taxable event entailing a levy of Export Duty as in the case of export, the levy of Export Duty cannot be justified under the provisions of the Customs Act, 1962." 19. Furth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of Export Duty on the movement of goods from the Domestic Tariff Area to the Special Economic Zone is not at all provided for or contemplated thereunder, which will be evident from the following facts. 41.2-4 The Statement of Objects and Reasons of the SEZ Act, 2005 indicates that the policy for setting up of Special Economic Zones had been adopted by the Government of India with a view to provide an internationally competitive environment for export. The objectives of the Special Economic Zones include making available (to the Unit) goods and services free of taxes and duties for export production, supported by integrated infrastructure." 20. It is further relevant to note that while dealing with the question as to whether export duty can be imposed under the Customs Act, 1962 by incorporating the definition of the term "export" under the SEZ Act, 2005 into the Customs Act, 1962, it was held that:- "41.3-1 The term "export" having been defined in the Customs Act, 1962, for the purposes of that Act, there is no question of adopting or applying the meaning of the said term under another enactment for any purpose of levying duty under the Customs Act, 1962. In other words, a def ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oes not justify adoption of a different definition in the Act for the purposes of another statute. A non obstante clause only enables the provisions of the Act containing it to prevail over the provisions of another enactment in case of any conflict in the operation of the Act containing the non obstante clause. In other words, if the provision of both the enactments apply in a given case and there is a conflict, the provisions of the Act containing the non obstante clause would ordinarily prevail. In the present case, the movement of goods from the Domestic Tariff Area into the Special Economic Zone is treated as an export under the SEZ Act, 2005, which does not contain any provision for levy of export duty on the same. On the other hand, export duty is levied under the Customs Act, 1962 on export of goods from India to a place outside India and the said Act does not contemplate levy of duty on movement of goods from the Domestic Tariff Area to the Special Economic Zone. Therefore, there is no conflict in applying the respective definitions of export in the two enactments for the purposes of both the Acts and therefore, the non obstante clause cannot be applied or invoked at all. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n his statement dated 23-10-2008. The investigation commenced pursuant to the information received about non-compliance of the statutory obligation regarding the CENVAT credit by the appellants and in the course of investigation, the said statement came to be recorded. In this regard, attention was sought to be drawn to ARE-1 filed by the appellants in relation to the month of June 2007. Specific attention was drawn to the goods described as Gen Sets and reference to Notification No. 42/2001 and the expression used "SEZ" in the column "Notification availed" in the said form. Referring to the same, it was sought to be contended that it was to the knowledge of the department that the goods were supplied to the Developer. However, perusal of the entire form ARE-1 in relation to the month of June 2010 nowhere discloses that the supply was to the Developer. It merely refers to the letters "SEZ". There is no presumption that the letters "SEZ" refers to the Developers. Rather considering the Special Economic Zones Act, such a reference could refer only to the Unit and not to the Developer. Being so, prima facie there was a case of suppression of relevant fact and hence it cannot be said t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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