Latest - TMI e-Newsletter
New User/ Regiser
2022 (6) TMI 707 - Central Excise
Head Note / Extract:
100% EOU - Demand of interest on duty paid on DTA clearances of warehoused goods - goods remained in warehouse for four years - period for which goods may remain in warehouse - what is relevant, intent to use the goods or actual use of goods? - HELD THAT:- There is no dispute that appellant is 100% EOU and the goods imported by them under exemption provided to 100% EOU whereby after warehousing the goods, the same were cleared after four years on payment of Customs duty as per Customs Warehouse provisions - By reading the provisions under Section 61 (1)(aa), it is clear that any goods intended to use by 100% EOU and the same were cleared after warehousing period of three years and in terms of sub-section (2)(i) the assessee was required to clear the goods after expiry of three years. In the present case, the assessee being 100% EOU, imported goods exempted under Notification No. 50/2003-Cus. There is no dispute about the intention of the said goods to be used in the manufacture of final product in the 100% EOU unit of the appellant. Section 61(1) does not provide that goods should be used in the manufacture but it only requires that the goods imported with intention of use in 100% EOU. As regards the intention for use, it is not disputed - Therefore, appellants clearances falls under Section 61(1)(aa), according to which the interest provisions provided under sub-Section (2)(i) shall apply, which provides that interest to be charged only after expiry of three years till the date of payment of duty. The appellant have discharged the customs duty along with interest beyond three years till the date of payment. Therefore, as per statutory provisions, as discussed above under Section 61, the demand of interest over and above the interest paid by the appellant is not sustainable. A similar issue has been considered by this Tribunal in the case of M/S. SUN PHARMACEUTICALS INDUSTRIES LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE & S.T., VADODARA [2015 (12) TMI 656 - CESTAT AHMEDABAD] where it was held that there is no occasion to demand interest from the appellant as there is no delay in payment of the duty. Interest can be levied only if there is delay in payment of duty, which is not the case herein. Appeal allowed - decided in favor of appellant.