Case Law Details
Annur Cotton Mills Vs Commissioner of Central Excise (CESTAT Chennai)
CESTAT Chennai held that duty demand on semi-finished goods and finished goods not sustainable as goods are exported on payment of duty under section 3(1) of the Central Excise Act, 1944.
Facts- On the basis of no objection and final exit order issued by the Development Commissioner the appellant exited the EOU scheme and got converted into a DTA unit, in the same premises and transferred all capital goods, raw materials, semi-finished goods and finished goods to the DTA unit. From the DTA unit, the finished goods were exported and the semi-finished goods were fully processed and also exported on payment of duty under claim of rebate of duty in terms of Rule 18 of CER, 2002.
While examining the rebate claims, it appeared to the Department that the assesse has not correctly paid the duty on semi-finished goods and finished goods at the time of de-bonding into a DTA unit. The assesse had discharged duty on semi-finished goods and finished goods by availing the concession rate of duty under Notification No. 23/2003-CE dated 31.03.2003. Further for arriving at the assessable value, the appellant had not adopted Rule 14 of Customs Act, 1962 in so far as the freight charges, insurance and landing charges were not included in the assessable value.
Accordingly, Show Cause Notice was issued proposing to demand the short paid duty on semi-finished goods and finished goods which were transferred to DTA at the time of de-bonding. It was also proposed to enhance the assessable value by including the freight charges insurance and landing charges. After due process of law, the original authority confirmed the demands, interest and penalty. Aggrieved by the duty demand, interest and penalties the assesse has filed appeal. The proposal to enhance the value by including various charges was dropped by the adjudicating authority. Being aggrieved, the department has filed appeal.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
