RELIANCE INDUSTRIES LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) Petitioners have challenged an order-in-appeal dated 14.03.2018 passed by the Director General of Foreign Trade. The challenge arises in following background:

(2.) Petitioner No.1 is a public limited company. Petitioner No.2 is the Director of the company. During the period between June 2007 and March 2008, petitioner No.1-company was charging as 100% as Export Oriented Unit ['EOU' for short]. During such period, the respondent authorities had granted reimbursement of central sales tax on goods manufactured in India and received by the petitioner as an EOU. This was in terms of the Foreign Trade Policy 2004-09 and, in particular, para 6.11 (c) contained therein.

(3.) Nearly five years later, the respondents wrote a letter to the petitioner on 30.10.2013 stating that audit conducted had detected that the petitioner had been incorrectly granted reimbursement of CST paid on raw material, components, consumers' packing materials etc. purchased from units situated in Domestic Tariff Area ['DTA' for short]. According to the respondents, as per para 14-I-I of the handbook of procedures, an EOU would be entitled to reimbursement of CST in respect of only those purchases made from DTA which are used for production of goods meant for export or utilized for export services. The CST paid on raw materials etc purchased from DTA which are used in manufacture of goods sold in DTA would not be eligible for reimbursement of CST.