TMI Blog2009 (3) TMI 524X X X X Extracts X X X X X X X X Extracts X X X X ..... s per Tribunal decision of Maruti Cottex Ltd. v. CCE 2008 -TMI - 53645 - CESTAT, SOUTH ZONAL BENCH, BANGALORE. Supply of goods to DFRC holders considered as deemed exports as per EXIM Policy. Demand not sustainable. - E/499 & 1024/2005 - 970-971/2009 - Dated:- 24-3-2009 - S/Shri T.K. Jayaraman, Member (T) and M.V. Ravindran, Member (J) Shri G. Shivadass, Advocate, for the Appellant. Shri V. Poorna Chandra Rao, SDR, for the Respondent. [Order per : T.K. Jayaraman, Member (T)]. - Both assessee and revenue are in appeal against the Order-in-Original No. 3/2005 dated 23-2-2005 passed by the Commissioner of Customs Central Excise, Hyderabad-I Commissionerate, Hyderabad.). 2. We heard both sides. 3. The assessees are 100% E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der Notification No. 28/2001 dated 16-5-2001. Hence, duty (CVD) was demanded on clearances of fabrics made to ARO holders for the period from 1-4-2001 to 31-7-2002. The Commissioner passed an ex-parte order which was set aside by this Bench in Final Order No. 360/2004, dated 13-2-2004 remanding the matter for de novo adjudication. In the de novo order the Commissioner dropped a part of the demand on ground of limitation but confirmed the duty of Rs. 60,60,914/- besides imposing a penalty of Rs. 6,00,000/- and demanding interest. As the demand was restricted to normal period under Section 11A, it has been restricted only to demand CVD. The assessee is aggrieved over the demand of CVD but revenue is also aggrieved over the impugned order (i) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. It was urged that the Apex Court in the case of SIV Industries Ltd. v. Commissioner - 2000 (117) E.L.T. 281 (S.C.) has held that the expression "allowed to be sold in India" would cover only the clearances approved by the Development Commissioner. The clearances to DFRC holders are not covered by the permission of the Development Commissioner and cannot be categorized as "goods allowed to be sold in India", therefore, they would not be covered by exclusion clause in the said notification. It was stated that the Commissioner denied the benefit of Notification on the ground that the expression used in Section 3 prior to 11-5-2001 viz., "allowed to be sold in India" has, been substituted by the expression "brought to any other place in Indi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Policy, deemed exports would be eligible for refund of terminal excise duty. Therefore, any duty paid by the assessee would be avalable as refund and it would only be scriptory exercise in paying the amount and getting the refund of it. The following case laws were relied on. (a) Gopal Zarda Udyog. v. CCE - 2001 (128) E.L.T. 409. (b) CCE, Bangalore. v. M/s. BPL Sanyo Utilities Appliance - 2004 (177) E.L.T. 722 (T) = 2004 (62) RLT 293. 5. The learned departmental representative reiterated the department's contentions in the revenue's appeal. 6. We have gone through the records of the case carefully. The show cause notice covers two issues. (1) A demand for the period from 1-4-2001 to 16-5-01 demanding Basic Cust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment Commissioner, therefore, they cannot be categorized as goods "allowed to be, sold in India". In other words, the clearances to DFRC holders would be exempt under Notification No. 125/84-C.E., dt. 26-5-1984. t is also noticed that this Bench in the case of Maruti Cottex Ltd. (supra) has held that clearances made by 100% EOU to DFRC holders would be treated as "goods not allowed to be sold in India"and hence, eligible to exemption under Notification No. 125-84-C.E. The above decision of the Tribunal has been upheld by the Hon'ble Supreme Court. It is further seen that in terms of para 7.7 of the Policy, the supply of goods to the DFRC holders is considered as deemed exports. In these circumstances, even the duty demand is not sustainable ..... X X X X Extracts X X X X X X X X Extracts X X X X
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