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TMI Blog2023 (2) TMI 740X X X X Extracts X X X X X X X X Extracts X X X X ..... te is found as blocks in nature which is cut by the appellant into slabs, polished and exported. As a 100% EOU, the appellant is entitled to import goods duty free as per Notification No. 52/2003-CUS as amended from time to time. This exemption notification is subject to some conditions including a condition that the appellant executes a bond with a customs authority binding itself to pay on demand an amount equal to duty leviable on the goods and interest at a rate specified by the Notification issued under section 28AB in certain situations. One of the situations in which the appellant has to pay duty is as follows; "In the case of goods other than capital goods, such goods as are not proved to the satisfaction of the said officer to have been used in connection with the production or packaging of goods in accordance with SION for export out of India or cleared for home consumption within a period of three years from the date of import or procurement thereof or within such extended period as the said officer may, on being satisfied that there is sufficient cause for not using them as above within the said period, allow;" 3. It appeared to the revenue that the appellant used or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (a)? 6. It needs to be pointed out that the appellant had simultaneously filed Writ Petition No. 134084/2015 before the High Court of Rajasthan at Jodhpur and by order dated 06.03.2017 the High Court directed that the Writ Petition may be listed along with other Writ Petition No. 10379/2013. Further, by an order dated 24.11.2015, High Court directed that the respondents shall not adopt any coercive measures for recovery of the demand. Nothing has been brought on record which may indicate that there is any stay against deciding these appeals. 7. These appeals have been filed by the appellant on the following grounds: (a) The impugned order is against law, equity and justice; (b) Steel grits and saw blades are part and parcel of the gang saw machine which is a capital good and not inputs requiring compliance of SION. They are consumables goods and an essential part of the gang saw machine and should be considered as the part of the machine and not as inputs; (c) The appellant relied on the decision of this Tribunal in GEE GEE Granites Limited vs. Commissioner of Central Excise [2010(258) ELT 109 (Tri-Chennai)] which was overlooked by the lower authorities; (d) DGFT Policy C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uestion to be decided is to whether the appellant is liable to pay duty on the steel grits and saw blades consumed in excess of the SION. Undisputedly, the exemption Notification 22/2003-CUS, as applicable during the relevant period, was subject to various conditions including the condition that the appellant shall use consumables as per the SION norms. It is also undisputed that SION A1833 was applicable to the goods in question. Therefore, the quantity of grits and saw blades which the appellant could have used for manufacture of granite slabs for exports has to be, as per the SION prescribed for the purpose. If it exceeds these norms to the extent they are consumed in excess, they contravene the condition of the Notification. The appellant had executed a bond before the Assistant Commissioner at the time of import, undertaking to pay the duty along with interest if all the conditions are not fulfilled. 14. The first argument of the appellant is that the grits and saw blades should be considered as capital goods or as parts of capital goods and not as consumables and, therefore, SION should not apply. As may be seen the SION has been prescribed by the DGFT at serial no. A 1833 w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any, condition is violated. 15. It needs to be pointed out that in exemption Notifications there may be conditions which must be fulfilled prior to the clearance of the goods and conditions which must be fulfilled after their clearance. In this case the standard input output norm (SION) have to be calculated as 5% of the FOB value of exports. The fulfilment of this condition can, therefore, be ascertained only after the exports have been made. 16. Therefore, at the time of import, it is impossible for anyone to anticipate how much will be the value of exports and if this condition of the Notification will be violated. When issuing the show cause notice the Department calculated the FOB value of the export, the value of the steel grits imported and the value of saw blades imported and calculated the excess value of imports. Duty has been demanded only on that amount. We, therefore, find no force in the submissions made by learned counsel for the appellant that the demand is time barred because the course of action arose only after the appellant completed its export and the value of such exports was known. The appellant should have, on own its own, paid the duty in fulfilment of i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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