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TMI Blog2018 (12) TMI 1175X X X X Extracts X X X X X X X X Extracts X X X X ..... in the duty liability and consequent mandatory penalty in respect of yarn removed without permission of Development Commissioner (Authority appointed under Foreign Trade Development Act) without duty payment to DTA. The period involved is prior to 19.01.2001. The Commissioner has in his Order held as follows: Thus, the decision is that prior to 11.05.2001 duties were leviable as under (i) Yes duty is required to be paid on materials deemed to have been used in the final goods removed without permission. (ii) Whether goods are indigenous and procured under CT-3, the duty would be Excise Duty equal to aggregate duty of Customs. When materials are imported it would be Customs Duty. (iii) Once input duty is paid, only normal excise duty is payable on final goods removed without permission. The appellant s contention of incorrect duty calculation is admitted partially. The duty is reworked on the principle enumerated above. The duty liability is reduced to ₹ 16,63,038 as against the total duty liability of ₹ 48,34,138/- as detailed in the table Annexed to this Order. Consequently, the penalty under Section 11AC stands reduced to ₹ 16,63,038 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xcise Tariff Act, 1985 to be levied (1) There shall be levied and collected in such manner as may be prescribed, - (a) a duty of excise on all excisable goods which are produced or manufactured in India as, and at the rates, set forth in the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986); (b) a special duty of excise, in addition to the duty of excise specified in clause (a) above, on excisable goods specified in the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) which are produced or manufactured in India, as, and at the rates, set forth in the said Second Schedule : Provided that the duties of excise which shall be levied and collected on any excisable goods which are produced or manufactured, - (i) in a free trade zone and brought to any other place in India; or (ii) by a hundred per cent export-oriented undertaking and allowed to be sold in India, shall be an amount equal to the aggregate of the duties of customs which would be leviable under Section 12 of the Customs Act, 1962 (52 of 1962), on like goods produced or manufactured outside India if imported into India, and where the said duties of cus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llenging the order of the tribunal whereby it had directed that the duty of central excise was not payable under Section 3(1) of the Act but under the proviso to Section 3(1) of the Act. The appellant therein was granted permission to set up a 100% Export Oriented Unit (EOU) for the manufacture of viscose staple fibre at its factory at Sirumugal in Coimbatore District in the State of Tamil Nadu. The letter of intent dated 18-12-1991 was issued to the appellant for the purpose by the Secretariat for Industrial Approvals (SIA), Ministry of Industry, Government of India. On 8-9-1993 the appellant therein made an application to the Secretary, Ministry of Commerce, Government of India and sought debonding of its unit from 100% EOU, i.e., withdrawal from 100% EOU Scheme. By letter dated 18-10-1993 of the Ministry of Commerce it was agreed in principle to allow the appellant to withdraw from the 100% EOU Scheme subject to the conditions on which withdrawal was permitted. Once the debonding of the unit was permitted, finished goods earlier manufactured in the 100% EOU could be cleared for domestic tariff area (DTA) on levy of duty of central excise. The dispute arose as to what rate of dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t authorities constituted for two different purposes. Permission to debond is a statutory function exercised by one statutory authority. On the other hand permission to sell in India is to be exercised by a different statutory authority. If reference is made to para 102 of the relevant import-export policy permission of the Development Commissioner is required for selling the goods in India up to a limit of 25% by 100% EOU. Para 117 of the policy deals with debonding of 100% EOU. Thus it is apparent that debonding and permission to sell in India are two different things having no connection with each other. It also becomes apparent that in view of the EOU Scheme as modified from time to time and corresponding amendments to Section 3 of the Act the expression allowed to be sold in India in the proviso to Section 3(1) of the Act is applicable only to sales made up to 25% of production by 100% EOU in DTA and with the permission of the Development Commissioner. No permission is required to sell goods manufactured by 100% EOU lying with it at the time approval is granted to debond. 24. After so stating the Court noted the stand of the revenue that by debonding permission ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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