9911796707
TMI Blog2011 (9) TMI 648X X X X Extracts X X X X X X X X Extracts X X X X ..... under 'Served From India Scheme' (SFIS) as per Para 3.6.4 of Foreign Trade Policy 2006-2007. The appellants cleared the finished goods by debiting the duty amount from the certificate produced by the buyers. The lower authorities were of the view that the appellants have used Cenvatable input in the manufacture of goods cleared under exemption and having not maintained proper and separate accounts, for inputs used in exempted goods, invocable under Rule 6(2) of CENVAT Credit Rules, 2004, demanded amount equal to 10% of the value of the goods vide Show Cause Notice dt.29.04.08, along with proposition for imposition of penalty and demand of interest. The appellants contested the Show Cause Notice on merit. The adjudicating authority did not agree with the contentions raised and confirmed the demand along with interest and equivalent amount of penalty. Aggrieved by such order, the appellants preferred an appeal before ld. Commissioner (Appeals). Ld. Commissioner (Appeals) did not agree with the contentions raised and rejected the appeal. 3. Ld.Counsel on behalf of the appellant would submit that the issue is now settled by the Tribunal vide order passed in the case of Un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ters 1 to 24 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975); (ii) in the case of service provider other than hotel or stand alone restaurant, capital goods including spares, office equipment, professional equipment, office furniture and consumables, related to its service sector business, when cleared against a Served from India Scheme Certificate, (hereinafter referred to as the said Certificate) issued under paragraph 3.6.4 of the Foreign Trade Policy, from - (1) the whole of the duty of excise leviable thereon under the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 1986); (2) the whole of the additional duty of excise leviable thereon under Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1958); and (3) the whole of the additional duty of excise leviable thereon under Section 3 of the Additional Duties of Excise (Textile and Textile Articles) Act, 1978 (40 of 1978) Subject to the following conditions, namely :- (i) that the said certificate has been issued to a service provider by the Regional Authority and it is produced before the jurisdictional Central Excise Officer at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his exemption.' This would clearly indicate that the conditions in the SFIS certificate are nothing but discharge of the duty which has to be paid by the appellant to the Government of India. This would almost equal to the debits which are being made in the letter of undertaking furnished by an assessee for clearing the goods for export without payment of duty, as per provisions in Central Excise Rules, 2002, and the said debits are considered as discharge of duty liability and once the proof of export is produced, the amounts debited are re-credited. It is undisputed, in the case before me, that the debits which were made in the SFIS certificate were against the clearance which could be procured legally by the service provider and the holder of SFIS certificate. 8. It is also pertinent to note that subsequent to the issuance of the Notification No. 34/2006-C.E., dated 14-6-2006 and Central Board of Excise & Customs, vide Circular No. 837/14/2006-CX., dated 3-11-2006 had issued the following clarification : "2. References have been received, from Trade and DGFT to prescribe a procedure for debiting the original scrip issued under SFIS for payment of central excise duty in the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are cleared under SFIS. The CBEC circular also very specifically clarifies that the original certificate has to be produced before the jurisdictional Central Excise Officer for 'debiting the duties of excise leviable on the goods'. The wordings of notification and subsequent CBEC Circular, would make it clear that the duty liability which has been debited in the SFIS scrip, would amount to discharge of duty liability and not amounting to exemption, as was proposed by Revenue. 9. I find that Hon'ble High Court of Judicature at Madras in the case of Tanfac Industries Ltd. v. CCE (supra) had considered an issue which was identical. In the said case their lordships were considering whether the debits made under DEPB script is equivalent to payment of duty in cash. I find that their Lordship has held as under : "6. We are here concerned with the question, whether the debits under DEPB is equivalent to payment of duty in cash. 7....... 8 ..... 9...... 10..... 11...... 12. In fact, in that case, there were three bills of entries, only one of them was goods exported under DEEC Scheme and other two were under the DEPB Scheme. The difference drawn by the Supreme Court in the above j ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
