Home Case Index All Cases Customs Customs + HC Customs - 2014 (1) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (1) TMI 169 - HC - CustomsBenefit of Exemption Notification No. 32/2005-Cus. - Demand of Education Cess on CVD - Whether on imports made by an importer which otherwise qualify for exemption from payment of customs duty and additional duty under Exemption Notification No. 32/2005, would still be liable to pay Education Cess on such basic duty of customs and additional duty on the ground that such duty-free imports were being made under DEPB scheme - Held that:- As goods imported under the DEPB scheme by assessee by virtue of exemption notification No.45/2002, carry 'nil' rate of customs duty and additional duty they are also not liable to pay education cess at the prescribed rate - from the nature of DEPB scheme and the exemption granted to imports made under such scheme, it can be seen that the very purpose is to neutralise the import duty component on the imported goods used for production of export items. Such object is achieved through the DEPB scheme under which the exporter is given the facility of utilising the credits in the DEPB scrips for the purpose of adjustment against the customs duty liability on the goods imported for the ultimate purpose of export on value addition. Merely because the conditions provided for adjustment of credit in the DEPB scrips, it cannot be stated that either there was no exemption from payment of customs duty or that the Central Government was levying and collecting customs duty from the importers in form of adjustment of credit in the DEPB scrips.Thus through such adjustments on the DEPB scrips at the time of further imports, customs duty component is sought to be neutralised. Circular dated 8-7-2004, the Ministry of Finance, in a question whether goods that are fully exempt from excise/customs duty or are cleared without payment of such duty would be subject to education cess, clarified that the education cess is leviable at the rate of 2% of the aggregate of the duties of excise/customs levied and collected. If goods are fully exempted from excise duty or customs duty or are chargeable to nil rate of duty or are cleared without payment of duty under specified procedure such as clearance bond, there is no collection of duty and, therefore, no education cess would be leviable on such clearances- . Duty demands, were even otherwise made without issuing any show-cause notice or adjudication. Even on such grounds, the notices are liable to be quashed - Following decision of GUJARAT AMBUJA EXPORTS LTD & 1 Versus GOVT OF INDIA THRŽ UNDER SECRETARY (DBK) & 2 [2012 (7) TMI 679 - GUJARAT HIGH COURT] - Decided against Revenue.
|