TMI Blog2013 (6) TMI 10X X X X Extracts X X X X X X X X Extracts X X X X ..... - Ruling No.AAR/Cus/01/2013, Application No. AAR/44/Cus/07/2012 - - - Dated:- 27-5-2013 - Arijit Pasayat And Y G Parande, JJ. RULING:- Per: Arijit Pasayat, J (Chairperson): By the present ruling, application filed by M/s. GE India Industrial Private Limited (hereinafter referred to as the Applicant ), seeking advance ruling u/s.28H of the Customs Act, 1962 (in short the Act) stands disposed off . The factual scenario as projected by the applicant in the application is as follows: The applicant is a wholly owned subsidiary of a Foreign Company GE Holding Luxembourg Company Sarl, Luxembourg. The applicant falls under the definition of applicant under section 28E (c) (c) of the Act. The applicant proposes to establish a unit in a Free Trade Warehousing Zone (hereinafter referred to as FTWZ') in the State of Maharashtra for warehousing the goods procured from outside India. The applicant proposes to establish its FTWZ unit in a FTWZ which is already notified or will be notified as SEZ by the Central Government as per Sec. 4(1) of the SEZ Act. The Applicant proposes to import parts and components of wind operated electricity generators from outside Indi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cant from the SEZ unit to its DTA unit would be eligible for exemption from the payment of SAD under Notification No. 45/2005 Cus dated May 16, 2005? The Revenue has contended as noted below: The Applicant has submitted a copy of Chart prepared by them and countersigned by Company Secretaries M/s. V.K. Chaudhary Co. (CP No.4548) indicating 13.94% holdings by M/s. GE Pacific Pte. Ltd. Singapore and balance 86.06% holdings by M/s. GE Energy Europe BV Netherlands which are intermediate holding Companies of M/s. GE Holdings Luxembourg Co. Sarl, Luxembourg. However as per Balance Sheet for 2010-11 as submitted by Applicant vide their letter dated 3.8.2012, the ultimate Holding Company is General Electric Company USA . In this regard the Applicant has not submitted any other documentary evidence. It appears that the copy of Memorandum and Articles of Association also do not have any provision in this regard. The Applicant has sought the clarification as to whether the stock transfer by the Applicant from the SEZ/FTWZ Unit to its DTA Unit would be eligible for exemption from the payment of SAD under Notification No. 45/2005 Cus dated May 16, 2005? In this regard it is stated tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Minutes of the 45 th meeting of Approval Committee for section specific SEZ for Free Trade and Warehousing section held on 01 st August, 2012 at SEEPZ, SEZ Mumbai, the committee has approved the proposal for setting up FTWZ Unit of the Applicant in FTWZ-Arshiya, Panvel. The Applicant has not submitted any evidence that the goods in question are not exempted from payment of CST/VAT. Further the goods mentioned in Application are not figuring in the goods mentioned in minutes of Approval Committee meeting as above. As per existing SEZ Act 2005 and SEZ Rules 2006, there is no specific provision for transfer of goods by way of stock transfer to a DTA Unit, however it is presumed that the same is covered under clearance to DTA Units. As far as a Free Trade and Warehousing Zone (FTWZ)( which is different from a SEZ, is concerned, the process of formulation of separate FTWZ rules is going on and all the issues related with trading and warehousing will be dealt with which are not dealt in the existing SEZ rules. Therefore, it appears that it would be a pre-mature stage for an interpretation by Authority for Advance Rulings as the exemption under notification 45/2005-cus itself is base ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icant has tried to mislead the authority. The applicant would be eligible for the benefit of notification in relation to specific goods only after complying with the proviso thereof. The notification 114/2003 has no co-relation with the present notification and the benefit of any notification is dependent on fulfillment of the conditions of the notification. Accordingly the respondent revenue has prayed for rejecting the application both on the grounds non-maintainability and also on merits. The applicant has filed its rebuttal to the grounds raised by the respondent. It has been inter-alia stated as follows: According to the department, the Applicant has filed a chart (certified by the Company Secretary) indicating that M/s. GE Pacific Pte Limited, Singapore (GE Singapore) and M/s. GE Energy Europe BV Netherlands (GE Netherlands) are intermediate holding companies of the Applicant and which in turn are wholly owned subsidiaries of M/s GE Holdings Luxembourg Co. Sarl, Luxembourg ( GE Luxembourg'). However, the Balance sheet of the Applicant provides that GE Electric Company USA ( GE USA') is an ultimate holding company of the Applicant. According to the department, no other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DTA including stock transfer. The Applicant therefore, submits that even in the present case, the department should extend the benefit of the Custom Notification to the goods stock transferred by the Applicant from the FTWZ to its unit located in the DTA subject to the conditions mentioned in the Notification. The department has sought for an evidence to prove that the goods cleared by the Applicant are not exempted from the payment of VAT/CST or an undertaking that the goods cleared from the FTWZ unit are not exempted from the payment of VAT. The Applicant submits that in Para 4 to 6 and 12 to 15 of the Application, the Applicant has already submitted that the goods cleared from their FTWZ Unit are not exempted from the payment of VAT/CST neither under the SEZ Act nor under the VAT/CST laws. As already stated above, the parts and components of wind operated electricity generators (as listed above) are not exempted by the Maharashtra Government from the payment of the value added tax and are subject to VAT @ 5%. Further, the Maharashtra Government has not issued any order to exempt sale of goods stock transferred by the Applicant. Further, even the department could not produce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : Whether the goods stock transferred by the applicant SEZ unit to its DTA unit would be eligible for exemption from the payment os SAD under Nofification No. 45/2005 Cus dated May 16, 2005? According the applicant the goods are sent by way of stock transfer from the SEZ unit to its DTA unit. The position is crystal clear that Notification No. 45/2005 Cus exempts all goods cleared from the SEZ and brought to any of the place in India from the SAD levied thereon under Section 3(5) of the Tariff Act. However, when such goods are sold in domestic tariff area and are exempted by the State Government from the payment of sales-tax or VAT such exemption is not available. The applicant makes a positive statement that such goods when sold in domestic tariff area are not exempted by the State Government from payment of sales-tax or VAT. It is pointed out that under serials 82 and 103 of the Schedule C of MAVT Act the parts and components of wind operated electricity generators are subject to tax @ 5%. It is conceded position that goods imported by the applicant are not exempted by the State Government from the payment of VAT. It is to be noted that in case of stock transfer two ..... X X X X Extracts X X X X X X X X Extracts X X X X
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