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TMI Blog2015 (4) TMI 733X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Basic Customs Duty would have to be taken as nil, even if those DTA clearances are not in accordance with the conditions prescribed in para 6.8 of the Foreign Trade Policy. It is seen that same view has been taken by the Board in its Circular No. 305/83/94-FTT dated 15/09/1994. - the nature of the scrap cannot be determined on the basis as to whether it has been sold the actual users or the dealers, as only use to which Iron and Steel Scrap can be put, is by melting the same to make some other Iron and Steel products. Same view has been taken by the Tribunal in its judgments in the case of Indo Deutsche Trade Links vs. CC (Imports), Chennai reported in [2014 (2) TMI 779 - CESTAT CHENNAI] of the judgment. - part of the impugned order confirming the duty demand on the basis of denial of exemption under Notification No. 21/02-CUS in respect of Basic Customs Duty is not sustainable and the same has to be set aside. As regards the exemption from the portion of the Central Excise Duty equivalent to the Special Additional Customs Duty (SAD) payable under Section 3 (5) of the Customs Tariff Act, the Department s contention is that the SAD would be payable as the clearances are not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Customs Duty (SAD) at nil rate plus Education Cess and Secondary and Higher Education Cess (S H Cess). 1.2 There are three objections of the Department. 1.2.1 The first objection is that since the clearances were not being made in terms of para 6.8 (e) of the Foreign Trade Policy (FTP) 2004-2009, in as much as neither any standard input output norms in respect of scrap had been fixed nor the adhoc norms had been fixed by the Development Commissioner nor other conditions of para 6.8 (e) relating to clearance of waste and scrap by a 100% EOU into DTA have been satisfied, the nil rate of basic customs duty under Notification No. 21/02-Cus would not be available. The Department is also of the view that the scrap cleared into DTA is not melting scrap as the same has been sold to dealers not to actual users, while Notification No. 21/02-CUS is applicable only to melting scrap. 1.2.2 The second objection of the Department is about method of calculation of education cess and secondary and higher education cess (S H Cess) whether the same at the total rate of 3% (2% + 1%) of the Central Excise Duty chargeable would be leviable on the aggregate of the duties of Customs which in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asic Customs Duty exemption in respect of scrap under Notification No. 21/02-CUS (Sl. No. 200), in terms of this exemption notification, the melting scrap is fully and unconditionally exempt from duty, that this exemption from Basic Customs Duty to melting scrap is not linked with DTA clearances being made in accordance with para 6.8 (e) or 6.8 (a) of the Foreign Trade Policy or otherwise, that in this case the appellant had made clearances of scrap into DTA by paying full duty leviable in terms of proviso to Section 3 (1) of Central Excise Act, 1944 in terms of which the duty payable in respect of DTA clearances of a 100% EOU is the aggregate of Duties of Customs which has to be determined after taking into account the exemption notification, if any, applicable in respect of the same and such exemption notifications would be applicable irrespective of whether the clearances have been made in accordance with para 6.8 of the Foreign Trade Policy or otherwise, that in respect of the clearances of waste and scrap into DTA, the conditions specified in para 6.8 (e) of the Foreign Trade Policy are relevant only when the exemption under Notification No. 23/03-CE is availed, that in any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xemption notification exempts fully and unconditionally, the melting scrap imported into India. In respect of the DTA clearances of scrap made by the appellant, the duty is payable in terms of proviso to Section 3 (1) of Central Excise Act, 1944 and the quantum of this duty payable would be the Basic Customs Duty plus Additional Customs Duty plus Special Additional Customs Duty (SAD) plus education cess S H cess. Notification No. 23/03-CE prescribes the concessional rate of duty in respect of DTA clearances subject to the conditions specified in para 6.8 of the Foreign Trade Policy. Irrespective of whether the duty on the DTA clearances is paid at the concessional rate under Notification No. 23/03-CE or the duty is paid without availing of this exemption on the full rate prescribed under proviso to Section 3 (1), the Basic Customs Duty would have to be calculated at the rate applicable to the import of like goods into India, readwith any customs duty exemption notification issued under Section 25 of the Customs Act, 1962 and if in respect of any imported goods, the effective rate of duty is nil, it is the that rate which would have to be adopted and the basic Customs duty compo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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