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TMI Blog2014 (12) TMI 154X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner to debond and migrate to zero duty EPCG scheme - prima facie in absence of a Central Excise exemption notification prescribing nil rate or a concessional rate of duty, in respect of the capital goods procured from a 100% EOU against EPCG licence, at the time of debonding, the duty at the prevailing rate on the depreciated value in accordance with Para 8 of the Notification No. 22/2003-C.E. would be payable, even if the 100% EOU on debonding had been allowed to migrate to zero duty EPCG scheme. Thus, the appellant do not appear to have prima facie case in their favour - Partial stay granted. - E/56795/2013 - Stay Order No. S/51907/2014-EX(DB) - Dated:- 5-5-2014 - G. Raghuram, President and Shri Rakesh Kumar, Member (T) Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accordance with the provisions of Foreign Trade Policy subject to condition that prior to such clearance or debonding, duty at the rate in force on the date of debonding/clearance on the depreciated value determined at the rates of depreciation specified in this para is paid. Accordingly the Department was of the view that at the time of debonding, the duty amounting to ₹ 1,10,39,858/- was required to be paid by the appellant on the depreciated value of the capital goods. The appellant, however, claimed that the goods should be allowed to be debonded without payment against zero duty EPCG licence. According to the department, however, since there is no Central Excise Notification prescribing full duty exemption in respect of the goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he depreciated value of the capital goods and not at the nil rate under EPCG scheme, is accepted, the amendment made to Notification No. 22/2003-C.E. by Notification No. 24/2008-C.E. would be rendered meaningless, that Notification No. 22/2003-C.E. had been amended by Notification No. 24/2008-C.E., dated 11-4-2008 and by this amendment in Para 8 of the Notification, a provision had been introduced providing that no clearance or debonding of capital goods under EPCG scheme of Chapter 5 of Foreign Trade Policy shall be allowed if the unit had not fulfilled positive NFE criteria at the time of debonding in terms of Para 6.18(d) of Foreign Trade Policy and from this amendment, it is clear that migration to EPCG scheme at the time of debonding h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... toms exemption notification providing for import of goods against EPCG licence at nil rate of customs duty or concessional rate of customs duty, clearance of indigenous capital goods by a 100% EOU at nil rate/concessional rate prescribed in the customs exemption notification cannot be allowed. He pleaded that there is no exemption notification issued under Section 5A(1) of Central Excise Act, 1944 prescribing nil rate or concessional rate of duty in respect of indigenously procured capital goods cleared by a 100% EOU, and therefore, at the time of clearance of the goods on debonding, duty at the rate in force on the date of clearance on debonding on the depreciated value would be payable. He, therefore, pleaded that in order to safeguard th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd and migrate to zero duty EPCG scheme. The point of dispute is as to whether in respect of indigenous capital goods no Central Excise duty would be payable or whether duty at the prevailing rate on the depreciated value would be payable in terms of the provisions of Para 8 of the Notification No. 22/2003-C.E. as amended by Notification No. 24/2008-C.E. We are of prima facie view that in absence of a Central Excise exemption notification prescribing nil rate or a concessional rate of duty, in respect of the capital goods procured from a 100% EOU against EPCG licence, at the time of debonding, the duty at the prevailing rate on the depreciated value in accordance with Para 8 of the Notification No. 22/2003-C.E. would be payable, even if the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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