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2015 (11) TMI 1430 - AT - Customs100% EOU - duty payable on debonding - assessee had capitalized certain spare parts - revenue took the view that by this process, the value of the capital goods has increased and accordingly at the time of debonding, duty of ₹ 50,85,814/- should have been paid on this amount after 10% depreciation. - Interest u/s 28AB - Held that:- Even though spare parts have been capitalized, in our view once the spare parts have been used for replacement of the old and worn out machinery parts, the same become part of the machinery and they loose their separate identity. The use of these spare parts for replacing the old and worn out parts of the machinery would not increase the value of the machinery. At the time of debonding, the duty is payable on the value of the duty free raw materials and the depreciated value of the imported or indigenously procured capital goods and for this purpose, the value of the capital goods cannot be enhanced by the value of the spare parts used from time to time, even if the same have been capitalized. - at the time of debonding, the Jurisdictional Inspector, Central Excise, after checking their records and stock, had determined the appellants duty liability and had communicated the same under his letter dated 10/04/04 and at that time also he had checked the account of receipt and consumption of the imported as well as indigenously procured spare parts - appellant cannot be accused of suppressing the relevant information from the Department and, therefore, no justification for invoking the extended period under proviso to Section 28 (1) of the Customs Act, 1962 and, as such, the show cause notice dated 19.02.2009 is time barred. - impugned order is not sustainable on merits as well as on limitation. The same is set aside - Decided in favour of assessee.
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