CCE Vs. FUTURA POLYMERS LTD.

JUDGEMENT

(1.) THIS appeal filed by the department is against an order of learned Commissioner (Appeals) allowing the benefit of Notification No. 15/944 CE dated 1.3.94 (as amended) to the respondents thereby allowing exclusion of countervailing duty (CVD) from the quantification of duty of excise leviable on the goods removed by them as 100% EOU to the domestic tariff area (DTA) during the period 1.1.96 to 3.7.2006. After examining the records and. hearing both sides, we find that there is no dispute regarding the clearance of the goods to DTA. The goods were cleared as permitted by the Development Commissioner. The dispute relates to the quantum of duty of excise payable by the EOU in respect of the said goods for the said period. In terms of Notification No. 2/95 -CE dt. 4.1.95 read with the proviso to Section 3(1) of the Central Excise Act, a 100% EOU, during the above period, was liable to pay, in respect of excisable goods cleared to DTA, duty of excise to an extent equal to 50% of each of the duties of Customs which would be leviable under Section 12 of the Customs Act 1962 read with any Notification issued under Sub -section (1) of Section 25 of the said Act. In this quantification of the duty of excise, the respondents left out the amount of Additional Duty of Customs (CVD) leviable on like goods if manufactured outside India and imported into India. They did so by virtue of Notification No. 15/94 -CE dt. 1.3.94 which granted exemption from payment of duty of excise on like goods on condition that no credit of the duty paid on the inputs used in the manufacture of such goods had been availed of under Rule 57A of the Central Excise Rules, 1944. The department objected to the exclusion of CVD and took the view that, as the above condition attached to Notification No. 15/94 -CE was inapplicable to imported goods, nothing contained in the said Notification was applicable to the subject goods. Accordingly, a show -cause notice was issued to the party and the same was adjudicated upon by the jurisdictional Asst. Commissioner who held against the EOU. The appeal filed by the party against the decision of the original authority was allowed by the Commissioner (Appeals). Hence the present appeal of the Revenue.

(2.) IT appears from the impugned order that learned Commissioner (Appeals) relied on the Tribunal's decision in Kudremukh Iron Ore Co. Ltd. v. CCE Bangalore 2000 (125) ELT 693 (Tribunal), for holding that Notification No. 15/94 -CE was to be taken into account when the amount of duty payable by the respondents on the goods cleared to DTA during the period of dispute was quantified. Learned Counsel for the respondents has also, today, relied on the same decision rendered in Kudremukh Iron Ore case (supra). Learned SDR, on the other hand, has relied on the Bombay High Court's decision in the case of Ashok Traders v. UOI . We note that the Bombay High Court was not considering any goods pertaining to 100% EOU and that the issue which arose before the court was different from the one which arose before the Commissioner (Appeals) in the present -case. The decision of the Tribunal in Kudremukh Iron Ore case is found to be squarely applicable to the facts of the present case. In that case, it was Notification No. 19/88 -CE (which granted conditional exemption from payment of duty of excise on 'iron ore pellets') which was held to be applicable to the quantification of Excise Duty to be paid by the assessee (100% EOU) on iron ore pellets cleared to DTA as permitted by the Development Commissioner. The condition attached to Notification No. 19/88 -CE ibid is comparable to the one attached to Notification No. 15/94 -CE involved in the present case. Thus, on all fours, the Tribunal's decision in Kudremukh Iron Ore case is found to be a precedent to be followed in the present case. Learned Commissioner (Appeals) was rightly relying on the said decision and his order has to be sustained.

(3.) IN the result, the appeal is dismissed.