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TMI Blog2014 (7) TMI 269X X X X Extracts X X X X X X X X Extracts X X X X ..... ure of Grey Cotton Fabrics. The raw materials for the manufactures of fabrics are cotton yarn and polyester cotton yarn and they procured the raw materials from M/s. Jamshri Ranjit Singhji Spinning & Weaving Co. Ltd., Solapur (M/s. Jamshri in short), Shri Gopal Jajoo and M/s. Puja Textiles. Investigation of the activities of the appellant revealed that they had in collusion with M/s. Jamshri clandestinely manufactured and cleared polyester cotton grey fabrics measuring 8,10,969 metres valued at Rs. 2,66,74,509/- during June/July, 1997 to Sept. 1998 and again during Sept., 1999 to Dec., 1999 evading Central Excise duty to the tune of Rs. 1,22,35,660/-. Similarly, they had in collusion with Shri Gopal Jajoo and M/s. Puja Textiles manufactured ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 48,63,575/- and this permission was valid up to 31-7-1998. Subsequently, vide permission dated May 6, 1999, the appellant was given permission to clear into DTA a quantity of 31,144.81 metres valued at Rs. 12,29,908/- on the basis of production and exports made during 1-7-1998 to 31-8-1998 and this permission was valid up to 30-9-1999. Vide another permission dated May 6, 1999, the appellant was permitted to clear into DTA a quantity of 41,409 metres of grey fabrics valued at Rs. 17,59,882/- based on their production and exports during 1-10-1998 to 31-12-1998 and this permission was valid till 31-12-1999. Again vide permission dated 17-9-1999, the appellant was permitted to clear into DTA a quantity of 2,47,879/- metres of grey fabrics val ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o like goods when imported into India. Therefore, the impugned demands are not sustainable in law. Accordingly, he pleads for allowing the appeal. 4. The learned Addl. Commissioner (AR) appearing for the Revenue reiterates the findings of the adjudicating authority. 5. We have carefully considered the submissions made by both the sides. 5.1 As regards the issue whether the goods cleared by the appellant during the impugned period were allowed to be sold in India, the adjudicating authority has clearly held in para 14.10 of the impugned order that "the goods in question, namely, grey fabrics manufactured and cleared by M/s. VTM to the DTA to M/s. Jamshri and M/s. Pooja Textiles have to be considered as cleared with the perm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could not have availed the benefit of Notification No. 8/97-C.E. and, therefore, the appellant was liable to pay duty in terms of the proviso to Section 3(1) of the Central Excise Act, 1944. Even for the period prior to 2-6-1998, the domestic manufacturer who produced grey fabrics was eligible for Nil rate of duty, if such grey fabrics were produced out of duty paid yarn. In other words, there was no unconditional exemption to grey fabrics if produced by a manufacturer in the DTA. From the records of the case, it is evident that the appellant obtained raw materials duty free i.e. without payment of duty removed clandestinely from M/s. Jamshri, Gopal Jajoo and M/s. Pooja Textiles, without the cover of a CT-3 certificate and without the cover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to effect the following clearances in the DTA. Period DTA sale entitlement - Quantity (Metres) DTA sale entitlement - Value (Rs.) Permission No. & Date 1-4-1997 to 30-9-1998 2,25,688.81 1,01,20,871.00 SEEPZ/28/EOU/DTA/6595, dated 6-5-1999 1-10-1998 to 31-12-1998 41,409 17,59,882.00 SEEPZ/28/EOU/DTA/6593, dated 6-5-1999 valid till 31-12-1999 1-4-1999 to 30-6-1999 2,47,879 86,75,765/- SEEPZ/28/EOU/DTA, dated 17-9-1999 valid till 30-6-2000 Thus in respect of the above clearances, the appellant was eligible for the benefit of concessional rate of duty under Notification No. 2/95-C.E., dated 4-1-1995. Thus only in respect of clearances in excess of what has been permitted, the appellant would be liable to pay excise duty withou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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