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TMI Blog2016 (1) TMI 264X X X X Extracts X X X X X X X X Extracts X X X X ..... se duty under section 3(1) on any goods produced in India, it will not imply that the exemption from Central Excise duty will also be automatically available on goods produced and cleared by a 100% EOU. It is quite obvious from this proviso that, by virtue of exemption under Section 5A(1), goods produced by a 100% EOU do not get automatically exempted. This is so because the duty payable by a 100% EOU is equal to the aggregate of customs duties. - The duty payable on goods produced and cleared by a 100% EOU is to be seen in terms of provisions of Section 3(1) and while calculating this duty, the CVD component is to be calculated on the basis of excise duty payable on such products produced in India. And if such duty payable is a concessiona ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 136-CE/2006, dated 17.8.2006 and No. 87-CE, dated 30.6.2006 passed by the Commissioner of Central Excise Service Tax (Appeals), Lucknow. 2. The facts are that the appellant are a 100% EOU manufacturing textile and textile articles. They had permission from Development Commissioner for DTA sales. On such sales, they paid Basic Customs duty, Edu. Cess under the provisions of Section 3(1) proviso of the Central Excise Act, 1944. Under the proviso to this section, the duty payable on any excisable goods manufactured by a 100% EOU is equal to the aggregate of duties of customs leviable on like goods produced or manufactured outside India, if imported into India. Thus, the duty leviable in the present case includes CVD payable under the Cu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 would be admissible and the proviso to section 5A(1) does not pose a bar as held by the Hon'ble Delhi High Court in the case of Plastic Processors v. Union of India 2002 (143) ELT 521 which is affirmed by the Hon'ble Supreme Court in 2005 (186) ELT A27. 5. Heard both sides and considered the submissions. 6. The facts of the case have been brought out in the above paras. We find that the central issue is whether the proviso to Section 5A(1) will be applicable in the present case while considering application of Notifications 29/2004 and 30/2004. For sake of convenience, Section 5A(1) is reproduced below: - (1) If the Central Government is satisfied that it is necessary in the public interest so to do, it may, by notificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entral Excise Act, which is reproduced above. We find that there has been total mis-appreciation of this provision of law. Section 5A(1) only grants power to exempt excise duty leviable under Section 3(1) of the Central Excise Act. The proviso to section 5A(1) is only to state that even if there is exemption from Central Excise duty under section 3(1) on any goods produced in India, it will not imply that the exemption from Central Excise duty will also be automatically available on goods produced and cleared by a 100% EOU. It is quite obvious from this proviso that, by virtue of exemption under Section 5A(1), goods produced by a 100% EOU do not get automatically exempted. This is so because the duty payable by a 100% EOU is equal to the ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lastic Processors [2009] 12 SCC 747. 6.2 The learned AR contended that the judgment in the case of Plastic Processors (supra) was in the context of Board Circular 30/2000 dated 10.5.2000 which was quashed by the Hon'ble High Court to the extent it imposes liability of CVD. We find that in view of the detailed discussion and interpretation of the relevant provisions of law made by us above, the Hon'ble High Court judgment would still held good in the context of the present facts before us. Our view is also supported by the Hon'ble High Court judgment in the case of Satya Metals (supra). 6.3 Although the Commissioner (Appeals) has held that the proviso to Section 5A is not applicable, he has erred in holding that the benefi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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