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2020 (6) TMI 69 - AT - Customs100% EOU - Removal/diversion of imported inputs in contravention of Notifications 53/97 dated 3.6.1997 and 52/2003 dated 31.3.2003 - indigenous inputs procured on the basis of CT-3 certificates and diverted in contravention of Notification No.136/94 dated 10.11.1994 as amended and No.22/2003-CE dated 31.3.2003 as amended - duty chargeable on inputs used exclusively for manufacture of goods sold in DTA - Items imported and traded without any manufacture. - Process amounting to manufacture or not - labeling and repacking of the impugned goods. HELD THAT:- As demonstrated by the learned counsel that the recipient in the case is also an EOU, who are otherwise entitled to procure goods by import or on CE-3 certificates as per the provisions of FTP. We find that the provisions of the FTP and the Customs Notification are required to be read in harmony. It is not the case of the department that the imported or domestically procured goods are diverted into open market. The department agrees to the fact that the appellants have transferred the impugned goods to their sister EOU unit in Venkatapur. There is no allegation or proof that the same has been diverted by either of the EOUs. The appellants have submitted a Chartered Accountant certificate correlating transfer and receipt of the goods. They have also made good the duty for deficient items along with interest. Eligibility of olives to be sold in the domestic market - HELD THAT:- The provisions of FTP 2004-2009 as explained by CBEC Circular No.7/2006 are very clear in this regard. We hold that similar goods do not necessarily mean same goods. Looking into the LOP issued to the appellants and the fact that they were exported olives till 2000 under the same LOP, we find no reason as to why the DTA clearance of the same is not permissible afterwards. Alleged trading of jams - HELD THAT:- CBEC Circular No.314/30/97-CE dated6.5.1997 clarifies that it is clarified that a broader view is called for in respect of the interpretation of the provisions of Notification No. 1/95-C.E. and the exemption may not be restricted only to cases where “manufacture‟ under section 2(f) of Central Excise Act is involved. It is clarified that the exemption under Notification No. 1/95- C.E. will also be applicable to a 100% EOU engaged in “galvanising‟ of black MS pipes. This issues with the approval of the Board. Appeal allowed - decided in favor of appellant.
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