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TMI Blog2003 (1) TMI 195X X X X Extracts X X X X X X X X Extracts X X X X ..... n their bonded premises for LSLL. This was as per instruction in Para 4 of the Board's Circular No. 67/98-Cus., dt. 14-9-98. This Para reads as under :- "4. Further to utilize the idle capacity of the EOU/EPZ units, it has also been decided that the EOU/EPZ units in Textiles, readymade garments, agro-processing and granite sectors may be permitted to undertake job work from the DTA units provided the finished products produced by such EOU/EPZ units will be exported directly from EOU/EPZ unit itself and these goods will not be sent back to the DTA. " (b) Readymade garments manufactured on job-work basis by the EOUs for LSLL on all Raw material supplied by them, had been removed from the bonded premises, directly to Bangalore Air Cargo Complex under 'transhipment shipping bills' and invoice/packing list of the EOUs with covering letter from the Superintendent of Customs, Customs Division, Bangalore addressed to the Assistant Commissioner of Customs, Exports, ACC, Bangalore intimating the removal of goods from the bonded warehouse to the gateway port for the purpose of export. (c) At Bangalore Air Cargo Complex, LSLL filed 'shipping bills' for claim of duty drawback on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all not be applicable to export of any of the commodities/products if such commodity/product is - (a) Manufactured partly or wholly in a warehouse under section 65 of the Customs Act, 1962 (52 of 1962), (b) ...................... (c) Manufactured and/or exported by a unit licensed as hundred percent export oriented undertaking in terms of the relevant provisions of the Import and Export Policy in force......................" (c) In view of the above provisions, the duty drawback of Rs. 26,47,739/60 received by LSLL and Rs. 3,07,881/63 claimed by LSLL appeared to be inadmissible in terms of paras 2(a) and (c) to general notes of Government of India Notifications No. 67/98-Cus. (N.T.), dtd. 1-9-98 as amended and 31/99-Cus. (N.T.), dtd. 20-5-1999 as amended inasmuch as the duty drawback had been sanctioned and received in respect of goods manufactured by the bonded warehouses of M/s. Tropicate Textiles Ltd. and M/s. Sara International Inc. in terms of Section 65 of the Customs Act, 1962 and also both M/s. Tropicate Textiles Ltd. and M/s. Sara International Inc., are units licensed as hundred percent export oriented undertakings in terms of the relevant provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manufacturing activity in the warehouse under Section 65 of the Customs Act, 1962. The "goods" manufactured on job work basis for M/s. Leela Scottish Lace Ltd., which have been subsequently exported under claim of duty Drawback have been manufactured wholly in the warehouse under Section 65 of the Customs Act, 1962. Hence, in terms of General Notes 2(a) of the Notification No. 67/98-Cus. (N.T.), dated 1-9-98, such "goods" manufactured on job work basis are not entitled to the Drawback claimed as per the rates prescribed in the Table under the said Notifications. (f) Duty Drawback at the rate specified in the table annexed to Notfn. No. 67/98-Cus. (N.T.), dated 1-9-98 is not applicable to "goods" manufactured by the 100% EOU and exported by a DTA unit inasmuch as clause 2(c) of the notification clearly spells out that "goods" manufactured and/or exported by 100% EOUs are not entitled to drawback under the notification. It has been contended that Para 2(c) of the Notification was not applicable for the reasons that manufacture and/or exported mentioned in the aforesaid Clause means only two conditions viz. (1) manufactured and/or exported by 100% EOU (2) Exported under 100% E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ace Ltd., DTA Unit for recovery of the erroneous payment of Drawback under Section 75A(2) of the Customs Act, 1962 read with Rule 16 of the Customs Central Excise Duties Drawback Rules, 1995. Therefore, the question of limitation as contended by the Advocate does not merit any consideration." (l) As regards the pending claims for shipment made during July and December 1999, he found : - "......As already discussed above, the DTA Unit is eligible for brand rate of Drawback fixed by the Drawback Directorate and Drawback would be admissible at the rates claimed by M/s. Leela Scottish Lace Ltd., in such cases. As I have already pointed out, no such application has been made by M/s. Leela Scottish Lace Ltd., and no special brand rate has been fixed. Hence, the claims filed by them, are liable to be rejected in terms of the exclusion clause contained in Para 2(a) (c) of the General Notes to Notification No. 67/98-Cus. (N.T.) and 31/99-Cus. (N.T.)". 5. After hearing both sides and considering the matter, it is found : - (a) 'Garments' falling under Chapter 61 or 62 of the tariff, are a commodity sui generis and for production thereof, the Raw Material Supplier is con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in implementing the above. (ii) Confirmation that DTA shall be the exporter who will file regular DBK shipping bill and that the DBK should be eligible for full all industry rate of drawback for such export. Reply (I) In case of EOU undertaking job work and such goods being exported, the existing procedure for removal of goods for export from an EOU to gateway ports shall be followed in this case also. (ii) The owner of the goods shall file the shipping bill and not the EOU unit (job worker). The benefits, if any, of the export shall accrue to the owner of the goods." As per these minute, the owner of the Readymade Garments in this case i.e., M/s. LSLL has been allowed to file a drawback shipping bill for export of the said goods and therefore the benefits of such an export on the drawback shipping bills permitted to be filed by the proper officer should accrue to the owners exporters i.e. M/s. LSLL, as assured and maintained at this meeting. The Commissioner's finding on this plea of the appellants are therefore rejected, since the minute do not show any purported meaning, as held by the Commissioner. The minutes when read plainly prescribe, that the procedure should be fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rial, if required to be removed from these premises, to levy of a Customs duty. Such levy would be not permissible, as there can be no levy on goods, removed from a warehouse for home consumption, other than those which are deposited under Section 60 or received transferred under Section 67 of the Customs Act. The Control envisaged and duty liabilities by the provisions of Chapter IX of the Customs Act, is only on imported non-duty paid goods and not on duty paid Domestic Tariff Area Goods, which may be brought into the bonded warehouse areas under specific relaxation granted by the Board's Circular dtd. 14-9-1998. In this view, manufacture of Readymade Garments on Raw Material supplied by LSLL is not covered by Section 65. Therefore, the findings arrived by the Commissioner, as regards the exclusion by this clause 2(a) of Notfn. No. 67/98 cannot be sustained. (e) Examining the exclusion by Notification No. 67/98-Cus. (N.T.), dated 1-9-98 by clause 2(c), which reads as under : - "c) Manufactured and/or exported by a unit licensed as hundred percent export oriented undertaking in terms of the relevant provisions of the Import and Export Policy in force........." it is foun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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