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TMI Blog2016 (3) TMI 380X X X X Extracts X X X X X X X X Extracts X X X X ..... reon; that the respondent have contravened the para 9.9 of EXIM Policy 97-02 read with para 102 of EXIM Policy 92-97 inasmuch as they have not properly followed the guidelines for the sale of goods in Domestic Tariff Area (DTA) by an E.O.U./E.P.Z. unit as provided in the Appendix 42 of Hand-Book of Procedure 97-02 and provisions contained in para 3 of Customs Notification No. 126/94-Cus., dated 3-6-1994; that the permission from the Development Commissioner of the EPZ for DTA sale has not been produced by the assessee which contravened the provisions of para 9.9 of the EXIM Policy 97-02, read with paras 9.22 & 9.23, and the guidelines of the Appendix-42 of the Hand Book of Procedure 97-02; that the respondent have not filed the RT-13 and also have not paid appropriate duty towards sale of the cut flowers in DTA during the period April, 1998 to December, 1999 & March, 2000 to June, 2000. In the adjudication, the Adjudicating Authority vide Orders-in-Original Nos. 49/2001, dated 1-8-2001, 98/2001, dated 26-11-2001, 44/2000, dated 10-3-2000, 110/2003, dated 27-11-2003 and 59/2001, dated 19-9-2001 confirmed the duty demands in terms of Notification No. 126/94-Cus., dated 3-6-1994 and a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of aforesaid notification, if the final product of the 100% EOU is other than excisable, in such case duty is required to be paid on the goods imported and used for manufacture/production/packaging of the final product of 100% EOU unit. In the present case the duty sought to be demanded is not on the imported inputs but on the non-excisable final products i.e. Cut Flowers. He submits that Notification No. 126/94-Cus. does not empower the department to demand duty on non-excisable final products but it only provides that in case of final product being non-excisable, Customs duty equal to amount of duty leviable on the inputs can only be demanded. Moreover, this is not the case of the Revenue that the respondent have imported any input or packaging material for use in the growing/producing/packaging the final product i.e. Cut Flowers. Therefore, in terms of the condition of the said notification, no duty is leviable on the cut flowers cleared in DTA. He countering the judgments relied upon by the ld. AR, submits that both the above judgments is on the issue of demand of customs duty on the imported goods used in the non-excisable goods cleared in DTA, whereas in the present case th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and such articles even if not exported out of India are allowed to be sold in India on payment of duty of excise leviable thereon under Section 3 of the Central Excises and Salt Act, 1944. However if such articles are not excisable, then customs duty on the imported goods used for the purpose of production, manufacture or packaging of such articles, an amount equal to the customs duty leviable on such articles as if imported as such, should be paid. As per this provisions a clear distinction between excisable goods and non-excisable goods were made. When excisable goods are manufactured then the excise duty in terms of Section 3 of Central Excises and Salt Act, 1944 are required to be paid which is otherwise equal to the Customs duty leviable on such article. In case of non-excisable goods, no excise duty or Customs duty on such non-excisable goods are required to be paid. Only customs duty equal to amount leviable on imported goods used for production, manufacture or packaging of such article are required to be paid. In the present case the final product is Cut Flowers which is sold in DTA market. The said Cut Flowers are not excisable, firstly there is no question of any paymen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods. In the case before us, there is no demand of duty on the imported inputs in terms of Notification 126/94. Therefore, the respondent is right in contending that the demands are not sustainable. 5. In view of the above factual and legal position, we find no merits in the appeals filed by the Revenue and accordingly the same are dismissed. Soex Flora P. Ltd. 3. The issue involved is relating to the demand of issue of cut flowers grown in India by 100% EOU and cleared for DTA sales. The Revenue was of the view that in the light of Notification No. 126/94, dated 3-6-1994, the respondents are liable to pay duty on inputs procured duty-free which were used in clearance of DTA sales. Further, in the show cause notice, demand has been raised under Section 11A of Central Excise Act, 1944. The learned Commissioner (Appeals) relying on Larger Bench decision in the case of Vikram Ispat v. CCE, Mumbai-III - 2000 (120) E.L.T. 800 (Tri.-LB) held that as the respondent is manufacturer of non-excisable goods, demand under Central Excise Act is not sustainable. Being aggrieved by the same, the Revenue is in appeals. 4. Heard both sides. 5. The learned AR appearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and scrap material arising in the course of production, manufacture or packaging of such articles) even if not exported out of India are allowed to be sold in India under and in accordance with the Export-Import Policy and in such quantity and subject to such other limitations and conditions as may be specified in this behalf by the Development Commissioner, on payment of duty of excise leviable thereon under Section 3 of the Central Excises and Salt Act, 1944 (1 of 1944) or where such articles (including rejects, waste and scrap material) are not excisable, customs duty equal in amount to that leviable on inputs obtained under this notification and used for the purpose of production, manufacture or packaging of such articles, which would have been paid, but for the exemption under this notification, shall be payable at the time of clearance of such articles." 3.1 Revenue has also appealed on the ground that in the case of Cosco Blossoms Pvt. Ltd. (supra) this Tribunal observed that "however we make it clear that the Revenue authorities will be at liberty to demand duty on the imported inputs if any used in the production of the cut flowers in question". 4. None appea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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