Commissioner of Central Goods & Service Tax, Earlier Commissioner of Central Excise & Service Tax Versus Continental Engines Ltd.
Central Excise
2017 (11) TMI 878 – RAJASTHAN HIGH COURT – 2018 (359) E.L.T. 358 (Raj.)
RAJASTHAN HIGH COURT – HC
Dated:- 8-11-2017
D. B. Central/Excise Appeal No. 72, 73, 74, 75, 76 / 2017
Central Excise
K. S. Jhaveri And Vijay Kumar Vyas, JJ.
For the Appellant : Mr. Siddharth Ranka
For the Respondent : Mr. P.K. Kasliwal with Mr. Priyesh Kasliwal
JUDGMENT
1. In these appeals common questions of law and facts are involved, hence, they are decided by this common judgment.
2. By way of these appeals, the appellant has assailed the judgment and order of the Tribunal whereby the Tribunal has partly allowed the appeal preferred by the assessee.
3. Counsel for the appellant has framed the following questions of law:-
In DB Excise Appeal No. 72/2017, 73/2017, 74/2017, 75/2017 & 76/2017
“i) Whether the ld. CESTAT was correct in law in
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l the three appeals is common with regard to availability of concessional rate of duty on the scrap cleared by 100% EOU (i.e. the appellant) in terms of notification no. 23/2003-CE dated 31.03.2003. the department has denined the benefit to the appellant on the ground that input-output norms in respect of the finished goods in their case were not fixed and approved under duty exemption scheme by the Development Commissioner for availing benefit of concessional rate of duty in terms of the annexure No. 23/2003-CE dated 31.03.2003. The condition no. 2 of the annexure to above notification stipulated that the benefit was available only if the goods were cleared in Domestic Tariff Area in accordance with para 6.8 (d) of the Exim Policy, the sale of waste/scrap/remnants by units not entitled to DTA sale shall be on payment of full duties. Appellant's contention is that they had applied for fixing input-output norms to the Development Commissioner but till date no norms had been fixed. The a
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ppellant that they had applied to the Development Commissioner for fixing inputoutput norms but till date no norms were fixed by the Development Commissioner in their case does not help the appellant in as much as they cleared the scrap in question without fulfillment of the requirement of fixation of the input output norms by the Development Commissioner for availing benefit of concessional rate of duty under notification no. 23/2003-CE dated 31.03.2003 read with Paragraph 6.8 of the Export and Import Policy. I observe that clearance of the scrap in question at concessional rate of duty cannot be made in terms of the above provisions without fulfillment of statutorily stipulated conditions. It is well settled that exemption notifications are to be given strict interpretation. As such the appellant was not entitled to clear the scrap at concessional rate of duty under the said notification no. 23/2003-CE dated 31.03.2003 during the relevant period. I further observe that the appellant
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ng the norms fixed by the Development Commissioner has since elapsed on 7.12.2007. That contention that the jurisdictional Range Officer had submitted a report to the Development Commissioner confirming the approx. wastage of 10% also cannot help them. The Range Officer is not the designated authority to issue any certificate required under the law as discussed above. The ratio of the judgments relied upon by the appellant are not applicable to the issue at hand in the given facts & circumstances.
The Circular No.21/95-Cus., dated 10.03.1995 referred to by the appellant has no concern with the issue involved in the instant case as the said circular was on a totally different subject. I observe that the appellant continued to pay concessional rate of duty in spite of knowing that they do not have the required approved norms for the impugned goods. Seen in this context, I am of the view that the quantum of penalty imposed by the adjudicating authority in each impugned order is reasona
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remand order of Commissioner (Appeals), the original authority has since dropped the demand for differential duty in respect of subsequent period. Accordingly, he prays that the period covered by the present appeal may also be decided in their favour.
5. At the time of clearance of the scrap in DTA the SION norms were not available to the appellants. However, the same has since been fixed by the DGFT vide their letter dt. 23.2.2009. The concessional rate of duty @ of 30% envisaged under Notification no. 23/2003 dated 31.3.2003 is available in cases where such scrap has been allowed to be cleared in DTA. The differential duty has been demanded for different periods by Revenue by taking that view that since no norms were available at the time of clearance of the scrap., the same are to be considered as cleared without authorization and hence not entitled to the benefit of the notification. Since the input output norms have since been fixed by the DGFT the benefit of concessional rate
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. We have heard counsel for both the sides.
8. The contention raised by the respondent is required to be accepted in view of the fact that while considering the matter, the Tribunal in para 3 as reproduced hereinabove has specifically observed that demand for differential duty since was dropped in respect of subsequent period.
9. Counsel for the appellant has relied upon the decision of the Supreme Court in the case of Bony Polymers Pvt. Ltd. Vs. Commissioner 2017 (345) E.L.T. A69 (SC) while confirming the order of Delhi Tribunal held as under:-
“Having gone through the records of the case, we are of the considered opinion that the appeal, being devoid of any merit, deserves to be dismissed and is dismissed accordingly.
The Appellate Tribunal in its impugned order had held that since Advocate DTA Sales permission granted under Para 6.8(k) of Foreign Trade Policy 2004-09 of FTP 2004-09 is not covered under Notification No. 23/2003- C.E. as per condition No. II(b), benefit of impu
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iew the facts and circumstances of the case, the applicants are directed to deposit an amount of Rs. 10,00,000/- lakhs in addition to the amount already deposited within eight weeks for hearing of the appeal. On deposit of the above mentioned amount, the pre-deposit of remaining amount of dues are waived and recovery of the same is stayed during the pendency of the appeals. Compliance is to be reported on 27-9-2013.”
9.2. He has also relied upon the decision in case of Meneta Automotive Components Pvt. Ltd. vs. C.C.E. & S.T. Rohtak reported in 2013 (292) E.L.T. 49 (Tri.-Del.) wherein it has been held as under:-
“We find that under the Notification No. 21/2002- Cus., dated 1-3-2002 the melting scrap of Iron & steel is exempted on S. No. 200 of the notification. There is no condition in the notification for availing the exemption. Prima facie the applicant has a strong case for availing the exemption, from basic Custom duty under Notification 21/2002. As regards the applicability of
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due compliance there shall be stay of recovery of the balance dues till disposal of the appeal.”
10. Counsel for the respondent has relied upon the order passed by Joint Commissioner in the case of assessee in case no. 39/2011 wherein it has been observed as under:-
“The Assistant Commissioner Central Excise Division Bhiwadi was requested to confirm whether the quantity of scrap cleared by the assessee at concessional rate of duty in DTA are within norms or not. And also to verify detained charts submitted by assessee to support their contention. The Assistant Commissioner Central Excise Division Bhiwadi has verified charts submitted by assessee and submitted their report vide their letter C.N. V (Misc.) 02/Adj/II/2009/3187 dated 14.03.2011 that the matter has been reexamined in terms of para 6 of Order in appeal No. 202(DK)CE/JPR-I/2009 dated 24.08.2009 passed by the Commissioner(Appeals) Central Excise Jaipur-I for scrap cleared during the period (April 2007 to Sept. 2007) invol
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