2006 (9) TMI 68 - AT - Central Excise

Warehousing station- Appellant declaration of Nadendla Kandriga Village as warehousing station were rejected in a decision.- Commissioner after considering all the situation allow that Nandendla Kandriga Village as warehousing station.

Summary

Issues Involved:
1. Refusal to declare Nandendla Kandriga Village as a Warehousing station.
2. Requirement of permission from the Development Commissioner.
3. Rigid adherence to rules by Customs authorities.
4. Liberal approach towards 100% EOUs as per Government policy.

Issue-wise Detailed Analysis:

1. Refusal to declare Nandendla Kandriga Village as a Warehousing station:
The appellants, a 100% EOU, applied on 5-11-1997 to declare Nandendla Kandriga Village as a Warehousing station. The Commissioner refused, stating the Joint Commissioner had already communicated this decision. The appellants contended that the Joint Commissioner's letter did not indicate it was a decision by the Commissioner and thus did not warrant an appeal. The Commissioner's refusal was based on a technicality, ignoring the liberal approach mandated by Government policies and CBEC instructions.

2. Requirement of permission from the Development Commissioner:
The Joint Commissioner's letter dated 9-2-2005 stated that permission from the Development Commissioner was required. The Development Commissioner granted this permission on 7-3-2005, but the Commissioner still rejected the application, stating the permission was under the Foreign Trade Policy 2004-2009 and could not fulfill the requirements of the 1997 application. The appellants argued that this permission should be considered an amendment to the original approval, effective from the original date.

3. Rigid adherence to rules by Customs authorities:
The Customs authorities adopted a rigid stance, as evidenced by the seizure of the DG set in November 1999 and the issuance of a Show Cause Notice on 31-1-2000 for violating Notification 53/97-Cus. This rigid approach contradicted the CBEC's instructions to adopt a liberal stance towards 100% EOUs to promote exports.

4. Liberal approach towards 100% EOUs as per Government policy:
The Government of India and CBEC have issued several circulars emphasizing a liberal approach towards 100% EOUs to promote exports. The CBEC's instructions include not insisting on space certificates and granting ex post facto approval for warehousing. The Commissioner's technical rejection of the appellants' request was contrary to these policies and instructions, undermining the Government's export promotion efforts.

Conclusion:
The Tribunal found the Commissioner's approach highly technical and contrary to Government and CBEC instructions promoting a liberal approach towards 100% EOUs. The impugned order was set aside, and the Commissioner was directed to favorably consider the appellants' request to declare Nandendla Kandriga Village as a Warehousing station from the date of their application, 5-11-1997, without further delay.