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2015 (9) TMI 516 - AT - Central Excise100% EOU - Export / DTA clearance of non-excisable / exempted goods - exempted goods versus Zero rated goods or Nill rated goods - interpretation of an exemption notification - Notification No.22/2003-CE or No.52/2003-Cus - Whether a 100% EOU is entitled to exemption on inputs used in the manufacture of finished goods, which are either non-excisable or if imported, are chargeable to Nil or exempted rates, in view of second Proviso to Clause 6 of Notification No.22/2003-CE, dt.31.03.2003 or Proviso to Clause 3 of Notification No.52/2003-Cus, dt.31.03.2003. Held that:- If this strict interpretation is not followed, then the provisos under consideration can never be made applicable for the recovery of input duty where finished goods are cleared at Nil , Exempted or free rates because all of them will be excisable as per the definition of excisable goods under Section 2(d) of the Central Excise Act, 1944. Such an interpretation will be discriminating to DTA units as all such inputs could be routed through 100% EOU to claim full exemption when similar clearances by DTA units will affect duty at intermediate stage. It has to be held that non-excisable words used in second proviso to Clause 6 of Notification No.22/2003-CE, dt.31.03.2003 and Proviso to Clause 3 of Notification No. 52/2003-Cus, dt.31.03.2003 will embrace in its expression all zero rated finished goods where on account of full exemption, or Nil / Free rates, or where no rate is specified under the relevant tariffs. - Decided against the assessee.
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