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TMI Blog2011 (5) TMI 915X X X X Extracts X X X X X X X X Extracts X X X X ..... ise (Goods of Special Importance) Act, 1957 and Section 136(3) of the Finance Act, 2001, the Central Government in public interest, exempted certain goods from the whole of duties of excise. The pre-conditions for exemption were specified in the Notification No. 8/2004 of 21.1.2004 which envisaged, duty exemption for North East based industrial units commencing commercial production, between 21.4.1997 to 28.2.2001. 3.2 Under Clause (B) of the exemption notification, the eligible units were required to utilize the tax benefits secured through exemption, for investment in plants and machinery, infrastructural or civil works, in manufacturing units and social projects in the North Eastern States. The permissible investments are to be made before expiry of 6 months, from the end of each quarter. 3.3 The manufacturers claiming exemptions are required to provide details of the investments made in terms of Clause (D) within the stipulated period, to an Industrial Appraisal Committee (hereinafter referred to as the IAC Committee), constituted by the Chief Commissioner of Central Excise, Shillong, the Principal Secretary of the Department of Industry of the State concerned where the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , most of the withdrawal applications of the manufacturer have been kept pending by the Jurisdictional Commissioner, without considering approval for withdrawal of the applied amount. Specifying the pending application(s) marked collectively as Annexure K, Mr. Bhattacharyya submits that for most of these applications, the Jurisdictional Commissioner has either not taken a decision for approving withdrawal or have failed to communicate his decision if taken, to the applicant. 5.2 The learned Counsel accordingly submits that since investment into permitted sectors are to be made within a time bound period of 4 years from the date of the deposit in the ESCROW account, an obligation is cast on the Jurisdictional Commissioner to deal expeditiously with the applications for investment. He submits that non-consideration of the withdrawal applications in due time, disables the manufacturer to make the investment within the permissible time frame. The further submission is that delay in considering withdrawal applications also result in cost escalation and the viability of the intended project(s) is impacted, to the prejudice of the manufacturer. 5.3 Referring to the forfeiture Clause ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rayers are incorporated in the writ petition, in course of his submission Mr. Bhattacharyya for the present, confines his submission to prayers (i) (ii) in the present proceeding. 8.1 For considering the first prayer for a direction on the respondents 2 3 to consider the pending application(s) (Annexure-K) of the petitioner, it would be appropriate to examine how the exemption benefits are to be granted. Under the notification No.8/2004 (Annexure H), the eligible industries can avail the benefits only when it satisfies the competent IAC Committee that investments were made in the permitted spheres specified in Clause (B). They are also to satisfy that the amount invested is not prematurely withdrawn before 10 years of investment. Only when these twin conditions under Clause (E) and (F) are satisfied, the benefits of duty exemption become available. In case of premature withdrawal, except for reinvestment in similarly permitted arenas specified in Clause (B), the proviso to Clause (F) requires the manufacturer to pay duty, equivalent to the amount withdrawn from the ESCROW account. 8.2 Further pre-conditions are placed through notification No.28/2004 (Annexure I) on the ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gathered that some of the withdrawal applications filed by the petitioners have been kept pending without any decision, for alleged inadequate information furnished by the applicant. For such applications, the authority could have either straightway rejected the application or could have asked for further particulars but they can't push the manufacturer to a stage of forfeiture of their money in the ESCROW account, by keeping the application(s) pending indefinitely, without taking any decision on the same. 9. In so far as the prayer (ii) for extension of time for investing the withdrawal amount, it is seen that 4 years outer limit is stipulated by the amendments incorporated w.e.f.1.3.2011. Sub-Clause (iv) of Clause (C) specifies that the clock starts ticking from the date when duty is deposited in the ESCROW account. If this time schedule from the date of deposit is to be adhered to, unless prompt decisions are taken on the manufacturer's withdrawal applications, they will not be able to make investment within the specified time limit, for any of the permissible projects specified in Clause (B) of the exemption notification. 10. The question is whether a manufacturer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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