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TMI Blog2001 (9) TMI 165X X X X Extracts X X X X X X X X Extracts X X X X ..... 50% of FOB value of export in DTA; that on an application made by them, Development Commissioner, NEPZ granted them permission to sell goods in DTA to the extent of Rs. 998.38 lakhs for the quarter April-June, 1999 and Rs. 801.69 lakhs for the quarter July-September, 1999; that accordingly the Appellants after obtaining the permission from the Jurisdictional Deputy Commissioner, sold the goods in DTA during January and April, 2000; that since the finished goods were manufactured out of wholly indigenous raw materials, they paid the excise duty in terms of Notification No. 8/97-C.E., dated 1-3-1997; that the Adjudicating Authority has confirmed the demand of duty and has imposed penalty on the ground that for the purpose of arriving at the DTA sale entitlement, only physical exports effected by them is to be taken into account and the deemed exports are to be ignored and accordingly benefit of Notification No. 8/97-C.E. is not available on the excess quantity removed by them to DTA. 3.The learned Counsel, further, submitted that all the clearance of the goods manufactured by the Appellants have been removed to the DTA on the basis of permission granted by the Development Commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... NFEP = A-B/A x 100 Where "A" is the FOB value of Exports and "B" is the sum total of the CIF value of all imported inputs. He further mentioned that Annexure-1 to Appendix 16E to the Handbook of Procedure provides that while calculating NFEP achieved, one of the basic components to be taken into consideration is "Value of physical Exports effected excluding DTA sales but including supplies made under Para 9.10 of the Policy"; that Para 4 of Annexure-1 to Appendix 16E also reads as under : "Value of Physical Exports : While calculating the physical exports, DTA sale made during the year are not to be accounted for. However, supplies made in accordance with Para 9.10 of the policy will be taken into consideration while arriving at the value of physical exports." the learned Counsel, thus, submitted that a combined reading of para 9.29 of the Policy, Appendix 16E of the Handbook of Procedure and Annexure-1 thereto clearly shows that the expression "FOB value of Exports" would cover sales effected in DTA in terms of para 9.10 of Policy also for the purpose of calculation of NFEP; that the said meaning should apply to this expression in para 9.9(b) also in view of the settled legal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g 50% of the FOB value of Exports and submitted that wherever legislature desired, specific provision was made in the notification about satisfaction of the Assistant/Deputy Commissioner. The learned Counsel also relied upon the decision in Siv Industries Ltd. v. CCE & Customs, 2000 (117) E.L.T. 281 (S.C.). 6.Countering the arguments, Shri R.C. Sankhla, learned DR, submitted that Handbook of Procedures (as amended up to 31-3-2000) provides the guidelines for governing the sales in the DTA as provided under paragraphs 8.36, 9.9 of the Export & Import Policy and 9.23, 9.24 of the Handbook of Procedures. According to guideline (f) in Appendix 42, DTA sale entitlement shall accrue only after the goods are physically exported during the relevant period; that accordingly it is apparent that only physical Exports were required to be taken into consideration and not the quantity cleared to other EOUs in the DTA. He also referred to Board's Circular No. 30/99-Cus., dated 25-5-1999, dealing with the revised EXIM Policy, 1997-2002 and corresponding Hand Book of Procedures incorporating amendments in the policy up to 31-3-1999. Accordingly to this Circular, he said the total value of the good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in terms of value (Rs. 801.69 lakhs). We find force in the submission of the learned Counsel for the Appellants that once the Development Commissioner has allowed them the permission to sell the goods up to a fixed value in the DTA, the Revenue cannot disallow the clearance and demand Central Excise duty on the ground that the entitlement was required to be restricted to 50% of the FOB value of Physical Exports. If the Revenue is of the view that the value of deemed export should not have been taken into consideration for arriving at the value of goods to be allowed to be sold in the DTA, the matter should have been taken up with the Development Commissioner who had initially accorded the permission to the Appellants. This has been the consistent view of the Appellate Tribunal wherever the permission under the Central Excise Act/Rules or Notification is accorded by an authority outside the Department. In the case of CCE, Kanpur v. Agra Leather Goods (P) Ltd, 2000 (39) RLT 674, the Tribunal, relying upon the decision in the case of Union Quality Plastics (P) Ltd v. CCE, Surat, l999 (35) RLT 339, held that the benefit of SSI "Notification could not be disallowed for the simple reas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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