TMI Blog2003 (5) TMI 169X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Directorate of Central Excise Intelligence, Madurai upon gathering intelligence that the appellants, a 100% EOU engaged, inter alia, in the manufacture of blended polyster cotton yarn falling under Chapter Heading 55.09 of CETA, 1985 were evading payment of duty in respect of Grey Fabrics and Blended Yarn, made a visit to the unit on 3-11-2000. During the course of verification, it was found out that MCL manufactured and cleared the said blended yarn to their own units at Aladiyur and Madurai without payment of duty by claiming full exemption under Advance Release Order (ARO) against Advance Licence Numbers dated 6-8-99 and 30-3-2000. On the basis of statements recorded and various details collected, a show cause notice dated 11-12-2000 was issued calling upon them to explain as to why the amounts should not be collected from them. The appellants filed their replies and after due consideration of the matter, the Commissioner passed the impugned order. The findings recorded in paras 9 to 17 are reproduced herein below : - "9. I have gone through he records of the case and considered the points put forth. The issues arising for determination in this case are, whether the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion under Section 5A providing for duty relief to excisable goods cleared from a 100% EOU, be it Notification No. 82/92-C.E. or Notification No. 28/2001-C.E. In fact, MCL themselves have been pleading for applying Notification No. 82/92-C.E. by reading amending Notification No. 20/2001-C.E. taking into account Circular No. 31/2001, dated 24-5-2001 of the CBEC. I have therefore no hesitation in holding that Notification No. 30/97-Cus., dated 1-4-97 or any other exemption Notification issued under the Customs Act would not be applicable to clearances from a 100% EOU. Therefore the claim of the assessees on this score is held as legally untenable. 11. It was clear from Notification No. 82/92-C.E., dated 27-8-92 that it conferred duty relief only to that portion of duty of excise equivalent to the basic customs duty since the clearances in question took place against advance release order under duty free import license issued after 1-4-95. Consequently, excise duty equivalent to Additional Duty of Customs (CVD) and Special Additional Duty of Customs (SAD) was payable on the goods as there was no exemption for these components of levy. As said already, the assessee is urging for exten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ratio has absolutely no application to the facts of this case. The second decision relied by the assessee related to M/s. Johnson Johnson Limited reported in 1994 (71) E.L.T. 438 (T). The facts of that case show that by an amending Notification dated 21-11-1986, the words "miconozole Nitrate" was substituted for the word "miconozole" in the earlier Notification. The Tribunal emphasized that the amending Notification used the expression that the words miconozole Nitrate shall be substituted and not the word miconozole be amended to read as miconozole Nitrate. In this case, Notification No. 28/2001-C.E., dated 16-5-2001 was issued after superseding in entirety the earlier Notification No. 82/92-C.E., dated 27-8-92. Therefore the ratio of this decision is also not applicable to the facts of this case. The other decision relied by the assessee is in the case of M/s. Fertilisers and Chemicals Travancore Ltd. reported in 2001 (133) E.L.T. 175 (T). In that case, the exemption notification originally provided duty-relief only to sulphur powder and not sulphur in granular form. However, by a subsequent amendment the words 'sulphur powder' were substituted with the word 'sulphur'. Thus, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imposition of penalty under Rule 9(2) would not arise for the simple reason that the clearance documents like invoices and AR3A were duly endorsed by the Bond Officer-in-charge. In this connection, copies of relevant documents were placed on record as evidence. I have perused the same. It is seen that in the invoices and the AR3As issued for clearances, MCL had respectively indicated "exempted" quoting the DEEC Licence No./Advance release No. and "yarn for weaving - under deemed export". I also find that these documents have been endorsed by the Superintendent of Central Excise in charge of the unit. Thus there is force in their submission that merely because nothing was indicated in the 173B declarations filed, it could not be held that they had an intention to either evade or avoid payment of duty. Therefore, the question of penalising the unit under Rule 9(2) also would not arise. 17. As the duty amount relating to CVD had been paid and supplementary invoice had been issued for the payment made enabling the buyer to avail CENVAT credit, I do not think that re-determination of duty liability is warranted in terms of the Larger Bench decision of CEGAT rendered in the case of M/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this regard, he referred to the Apex Court judgment rendered in the case of - (1) Johnson Johnson Ltd. v. CCE, Aurangabad, 1997 (92) E.L.T. 23 (S.C.); (2) Jain Engineering Co. v. CC, Bombay, 1987 (32) E.L.T. 3 (S.C.); (3) Bindawala Electrical Industries v. CCE, Kolkata-I, 2002 (145) E.L.T. 698 (Tri-Kolkata); (4) Johnson Johnson Ltd., 1994 (71) E.L.T. 438 (T); (5) FACT Ltd., 2001 (133) E.L.T. 175 (T); (6) Shaw Wallace Co., 1990 (50) E.L.T. 143 (T);(7) Super Cassettes Industries, 1992 (58) E.L.T. 105 (T); (8) CCE v. Parle Exports, 1988 (38) E.L.T. 741 (S.C.); 5. In sum, the learned representative argued that the CBEC circular makes it clear that the issue of amending Notification No. 31/2001 became a necessity for removing the anomalous situation. Therefore, the subsequent notification is a clarificatory notification having a retrospective effect. The demands are not liable to be confirmed. 6. Ld. SDR on the other hand took us through the entire order. She also relied on the written note filed by the Commissioner in this matter. The Commissioner in the written note has explained that the provision of Notification No. 82/92-C.E., ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion an amending notification in 2001 was issued to remove this anomaly. 9. We have carefully considered the submissions and have perused the entire records and the citations referred to before us. Appellants have drawn much support from the CBEC Circular which brought out the reason for bringing in an amending Notification No. 28/2001-C.E., dated 16-5-2001. It referred to the dichotomy which existed between the direct imports of inputs by Advance Licence Holders vis-a-vis the inputs sourced from EOU/EPZ/EHTP/STP/SEZ against Advance Release Order (ARO). Nowhere in this circular, it speaks about any ambiguity in the Notification No. 82/92-C.E. An anomalous situation is an incongruous situation created, wherein the Government has consciously given benefit to a set of persons while it has not given the same to another set of persons who are similarly placed. In order to remove such an anomaly, an amending notification was issued. It does not lead to an inference that the previous Notification No. 82/92-C.E. had inherent effects and ambiguity and what was implicit in the mother notification was required to be made explicit by issuing a subsequent notification. If such a situation was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty in the mother notification and there was difficulty in interpreting the terms of the notification for its application. Therefore, the amending notification was brought in to make it clear and explicit. In such circumstances, the Apex Court held that the amending notification will have retrospective applicability as it was clarificatory in nature. 11. Similar view was expressed by the Apex Court in the case of CCE v. Parle Exports (P) Ltd., 1988 (38) E.L.T. 741 (S.C.); Johnson Johnson Ltd. v. CCE, 1997 (92) E.L.T. 23 (S.C.). A similar view has been expressed by the Tribunal in the case of Johnson Johnson Ltd., 1994 (71) E.L.T. 438 (T); FACT Ltd. 2001 (133) E.L.T. 175 (T) and Super Cassettes Industries, 1992 (58) E.L.T. 105 (T). In all the citations referred to by the representative of the appellants, we notice that there was inherent defect in the original notification and an ambiguity existed which required to be clarified. In the present case, admittedly, the Notification No. 82/92-C.E. did not have any ambiguity and it was crystal clear one. The intention of the Govt. was not to grant the benefit of CVD SAD when Notification No. 82/92-C.E. was introduced. The benefit o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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