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2008 (6) TMI 203 - AT - Customs100% EOU – exemption - manufacture from DTA / indigenous procured goods – raw material versus consumables – textile industry - held that - Indigo dye, which is very much present in the Blue denim fabrics, though is small quantity (about 1.1%), has to be treated as a raw material, not a consumable - the term ‘consumables’ and ‘raw materials’ are understood in trade parlance, we have to look at the meaning of these terms in Indian trade circle, not in the trade circles of some remote corner of the world - Just because the quantity of Indigo dye present in denim is just 1.1% by weight or cost of Indigo dye is 2% to 2.5% of the production cost of denim fabrics, the Indigo dye will not cease to be a raw material for denim fabrics - benefit of exemption under Notification No. 8/97-CE is not applicable to the DTA clearances of Blue denim cloth in the manufacture of which imported Indigo had been used. Penalty u/s 11AC set arise
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