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2017 (1) TMI 132 - AT - Customs100% EOU - taxability - Waste/ scrap - dross - demand of duty and penalty - Held that: - The excisability of dross is now set to rest by the Hon’ble Apex court and other appellate forums in a number of decisions. The adjudicating authority has correctly placed reliance on the ratio of the judgment of Apex Court in the case of CCE Vs. Indian Aluminium Co. Ltd. [2006 (9) TMI 6 - SUPREME COURT OF INDIA] where it has been unequivocally held that dross and skimming are not excisable to duty - In the event, condition No.3 of Notification No.52/03-cus referred to above will definitely impact the appellant and they will have to necessarily pay Customs duty equal to amount that leviable on proportionate Aluminium ingots obtained under that Notification - applicable customs duty will have to be paid on the inputs contained in the dross/slag. Being an interpretational issue and also taking note of the fact that the appellant was paying duty on clearances of dross and slag even before issue of show-cause notice, we are of the considered opinion that the penalty of ₹ 15 lakhs imposed under Section 112 of the Customs Act is not sustainable. Appeal disposed off - decided partly in favor of assessee.
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