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TMI Blog2022 (10) TMI 511X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Assistant Commissioner whereby a demand of Rs. 84,255/- has been confirmed against the appellant and equal amount was imposed as penalty. 2. The appellant is a 100% Export Oriented Undertaking [EOU] engaged in the manufacture of transformers falling under Chapter 85 of the Central Excise Tariff. It has executed B-17 bond for export of final products. Subsequently, on January 23, 2012 the appellant opted out of EOU scheme and converted its unit into an ordinary unit. 3. As per the scheme of 100% EOU, the assessee has to execute a bond and fulfil other requirements after which all goods imported by it will be exempted from Customs duty and all goods domestically procured by it from other manufacturers will be exempted from Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iation and depreciation upto 100% is allowed." 4. The appellant has paid Central Excise duty and Customs duty on the depreciated value calculated as above reckoning part of the quarter as a full quarter. During audit of the appellant's accounts, it was pointed out that the depreciation should be calculated only for the actual period and not for the entire quarter. Accordingly, a show cause notice dated January 27, 2016 was issued to the appellant demanding Central Excise duty of Rs. 18,030/-, Customs Duty of Rs. 66,255/- along with interest invoking extended period of limitation and proposing to impose a penalty relying on paragraph 3 of CBEC Circular No. 14/2004-Cust dated 13.02.2004. The appellant contested the demand and the Assistant C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter shall be taken as a full quarter. (iii) Extended period of limitation is not invocable and penalty is not imposable upon the appellant. 5. Learned Authorised Representative supports the impugned order. 6. We have considered the submissions on both sides and perused the records. 7. It is undisputed that the appellant is a 100% EOU which has debonded and has paid appropriate Central Excise duty and Customs duty on the depreciated value of the capital goods as per the notifications. The short question which remains is while computing the depreciation for the last part of the quarter whether the appellant was allowed to avail depreciation only for the part of the quarter or for the entire quarter. Explanations to paragraph 8 of the Cen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmercial production, till date of payment of such duty. The Board vide circular 29/2003-Cus dated 3-4-2003 , also has clarified that depreciation could be allowed upto 100%. 2. It has come to the notice of the Board that divergent practices are being followed while allowing depreciation to EOU/EHTP/ STP units. In the field formations , in some Commissionerates , depreciation is being calculated for full years only. 3. The matter has been examined by the Board. In terms of the above stated notification depreciation is admissible till the date of payment of duty. Therefore, there is no basis for contending that depreciation would be allowed for full year or quarter year only. The depreciation is allowed in straight line method and would b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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