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TMI Blog2005 (2) TMI 163X X X X Extracts X X X X X X X X Extracts X X X X ..... ued on 2nd December, 1991. By interim order passed, the demand was stayed, subject to furnishing of Bank guarantee in the sum of Rs. 2,65,047/-. The bank guarantee was furnished by petitioner and has been kept alive. 3. The facts giving rise to the filing of writ petition may be briefly noted :- (i) Petitioner is a 100% export unit, established within the Noida Export Processing Zone (in brief NEPZ). Petitioner had imported the woollen and vellore fabrics for exporting woollen and knitwear garments. Being a 100% export unit, no customs duty was paid by the petitioner in imports by virtue of Notification bearing No. 339/85, dated 21st November, 1985, as amended by subsequent Notification Nos. 321/86, 405/86, 200/87, 352/87, 132 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at in pursuance to a contract entered into with a foreign buyer, the raw material was imported and finished goods were required to be exported to USSR on or before 15th November, 1999. Due to labour unrest, there was closure of the factory. About 11000 kg of the imported raw material remained unused at that time. Petitioner vide its letter dated 16th January, 1991 sought permission of respondent No. 1 to take the raw material out to another unit at Ludhiana for processing and fabricating the balance quantity of garments in order to fulfil the export obligation. The permission was granted by the Collector of Customs and Development Commissioner and communicated by the Assistant Collector of Customs vide its letter dated 30th January, 1991 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd by the Falta Export Processing Zone Board. 5. It is contended that the wastage claimed by the petitioner is well within the norms fixed. The wastage in fact had been brought back to the Zone. Hence no duty ought to be charged in respect of this wastage. Learned counsel further submits that it is not even the contention of the Respondents that the raw material i.e., woollen yarn and Vellore yarn, which was taken out of the Zone for production or manufacturing has not been so used for manufacture of goods, which have been 100% exported. It is also not the case of the respondents that any excess wastage has been claimed. Rather the wastage, rags, trimmings have been brought back also into the unit. In these circumstances, when permission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terials supplied to him with some ulterior purposes. 7. Mr. Aggarwal on behalf of the respondents opposes the writ petition, firstly on the ground that petitioner could have availed of regular appellate remedy and writ petition was thus not maintainable. Secondly, he submits that petitioner applied for permission to take the goods for manufacturing outside the Zone. He submits that the manufacturing within the Zone is under the control and supervision of the Customs and for permitting any manufacturing or processing outside the Zone, complete control and supervision of the Customs is not possible. It is on this account that conditions are put. As it was not feasible to control and supervise the manufacturing outside the Zone, a condition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stage, have been brought back into the unit within the Zone. The Notification itself provides for no duty being charged on the waste component, in paras (c) and (h), as noted above. The surviving question would be whether customs duty can be levied on the basis of the condition in the bank guarantee. In my view, the answer to that has to be in the negative. Once duty is not leviable on wastage component of the raw material, it would not make any difference whether the manufacture had been done within Zone or done outside the Zone, with permission. Merely on account of a condition in the bank guarantee, wherein petitioner can at best be taken to have consented to payment of duty on waste component, it will not clothe such a term, with author ..... X X X X Extracts X X X X X X X X Extracts X X X X
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