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2015 (2) TMI 824 - CESTAT MUMBAIWaiver of pre-deposit - Advance license for deemed export - Compacting process of bulk drugs is a manufacturing process or not - Denial of benefit of Notification No. 47/2002-Cus dated 22-4-2002 - Held that:- From the Export and Import Policy 2002-2007, it is clear that advance licenses can be issued for duty free import of materials required for the manufacture and deemed export of final goods and supplies to 100% EOU would constitute 'deemed exports'. Since the customs notification No. 47/2002 has been issued in the context of para 4.1 of the Exim Policy 2002-2007, the concept of manufacture and final goods have to be understood in terms of the said policy. The definition of 'manufacture' under para 9.30 of the Exim Policy is very wide and any process which brings into existence a product having a distinctive name, character or use and even processes such as refrigeration, repacking, polishing and labelling would also come within the purview of the said definition. In other words, the expression 'manufacture' used in the aforesaid exemption notification has to be understood in terms of the Exim Policy 2002-2007 and not in terms of the Central Excise Act or the definitions thereunder. The requirement of the notification is manufacture and export of 'goods' and not repeat not manufacture of 'excisable goods'. The definition of manufacture under section 2(f) of the Central Excise Act, 1944, applies when 'excisable goods' are involved and not otherwise. We have also perused some of the advance licences issued to the appellant. Thus from the advance licences issued to the appellant importer, there is no violation of any of the conditions stipulated either in the licence or in notification No. 47/2002-Cus and therefore, denial of exemption to the appellant in the impugned order is prima facie unsustainable in law and we hold accordingly. We further notice that the issue whether compacting amounts to 'manufacture' was specifically examined by a Committee consisting of officers from DGFT, Dept. of Industrial Promotion & Policy and Dept. of Pharmaceuticals. This Committee in the meeting held on 21-12-2010 concluded that the compacting process is a manufacturing process in itself which is intermediate stage before making a tablet. Thus when all the concerned authorities have held the process of compaction to be 'manufacture', we do not understand how the customs authorities can take a different view. The ration of decision Dina International [2003 (10) TMI 372 - CESTAT, MUMBAI] is equally apply here. As regards the charge of aiding and abetting by the co-appellants, we do not find any evidence led by the Revenue in this regard. If payments have been adjusted against money due, it is only a normal commercial practice and cannot be attributed to aiding and abetment. In view of the factual and legal analysis as above, we are of the considered view that the appellants have made a strong prima facie case for grant of stay. - stay granted.
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