SPECTRUM FABRICS Vs. COMMISSIONER OF CENTRAL EXCISE, SURAT

JUDGEMENT

(1.) THE appellant is a 100% EOU engaged in the manufacture of Dyed/Printed Fabrics (manmade fabrics) and Polyester Knitted Fabrics falling under Chapter No. 54 of Central Excise Tariff Act, 1985, out of the grey fabrics obtained indigenously or imported free of duty. The appellant was having LOP dated 20 -9 -2001 issued by the Development Commissioner KFTZ, Kandla for the manufacture of export of the final product. The said LOP was cancelled by Development Commissioner, Kandla special economic zone, vide his Order in Original No. 58/2002 -2003, dated 18 -2 -2003, in terms of the Provisions of Section 9 of Foreign Trade (Development and Regulation) Act, 1992 read with Rule 10 of FT (D&R) Act, 1992.

(2.) THE proceedings were initiated against the appellant under the Central Excise Act by issuing them a show cause notice on 16 -7 -2003 on the ground that since the LOP in their favour has been cancelled on 18 -2 -2003, their activities for receiving the goods as 100% EOU under CT -3s and to process and clear the same to other 100% EOU on CT -3s was in contravention of the Provisions of law and they are liable to pay duties in respect of the said activities.

(3.) DURING the course of adjudication, the appellant brought to the notice of the adjudicating authority that the order of the Development Commissioner dated 18 -2 -2003, cancelling their LOP was appealed against them before the Appellate Committee, Ministry of Commerce and Industry, New Delhi who has vide their order dated 23 -10 -2003 remanded the case back to the adjudicating authority for fresh hearing. During the de novo proceedings the Development Commissioner has passed order on 28 -4 -2004 and had dropped the proceedings against them as regards cancellation of LOP and their import - export code. As such they submitted that the entire basis of the show cause notice having been set aside by the Development Commissioner, the proceedings against them cannot be confirmed.