AUTOLITE (INDIA) LTD. Vs. CCE

JUDGEMENT

(1.) The issue involved in this appeal/filed by M/s. Autolite (India) Ltd., relates to the manner of computing the duty in terms of Notification No. 2/95 -CE, dated 4.1.95.

(2.) Shri K.K. Anand, learned Advocate, submitted that the Appellants, a hundred percent Export Oriented Undertaking (EOU), manufacture halogen bulbs which they were permitted to clear into Domestic Tariff Area (DTA) subject to the conditions specified in Notification No. 2/95 -CE dated 4.1.1995; that this Notification exempts all excisable goods manufactured in a 100% EOU and allowed to be sold in India from so much of the duty of excise as is in excess of the amount calculated at the rate of fifty percent of each of the duties of customs, which would be leviable under Section 12 of the Customs Act on the like goods manufactured outside India if imported into India; that the demand of duty has been confirmed on the ground that they were required to work out the duty liability first and thereafter 50% of the amount of each duty should have been taken together in view of Board's Circular No. 7/2001 -Cus dated 6.2.2001. The learned Advocate, further, submitted that the period involved in the present matter is from March 2000 to 28.2.2001 when the Notification No. 2/95 -CE exempted the impugned goods "from so much of the duty of excise .. as is in excess of the amount calculated at the rate of fifty percent of each of the duties of customs...", that after this Notification was amended by Notification No. 11/2000 -CE, dated 1.3.2002, the relevant portion reads as follows: "amount equivalent to 50% of the aggregate of the duties of customs"; that after this amendment the method of calculation as prescribed by the Board in Circular dated 6.2.2001 was compatible with Proviso to Section 3(1) of the Central Excise Act; that, however, during the material period, the terms of the Notification were at variance with those of Proviso; that the Board vide Circular dated 18.5.94 provided a method of computation of the duty to be paid by 100% EOU; that the said method was adopted by them for the period of demand; that Board's Circular dated 6.2.2001 cannot have retrospective effect and the applicable method of computation of duty should be the one laid down by the Board in Circular dated 18.5.94. Reliance has been placed on the decision in the case of Futura Polymers Ltd. v. CCE, Chennai, 2003 (86) ECC 375 (T): 2003 (152) ELT 156 (T).

(3.) Countering the arguments, Shri P.M. Rao, learned DR, submitted that after the amendment of Notification No. 2/95 -CE by Notification No. 38/99 -CE, dated 16.9.99, the Board has issued a Circular F. No. 345/12/99 -TRU dated 24.9.99 wherein also the method of computation was illustrate; that the said Circular should be followed for the purpose of calculating the duty.