TMI Blog2000 (7) TMI 964X X X X Extracts X X X X X X X X Extracts X X X X ..... M Policy and the provisions of the Central Excise Act, 1944 and the Customs Act, 1962. The goods manufactured in 100% Export Oriented Units (EOUs) or those manufactured in the Export Processing Zone (EPZ) are liable to duties of excise equivalent to the aggregate of duties of customs, which would be leviable under Section 12 of the Customs Act, 1962 or any other law applicable. Petitioners are paying duties in respect of goods sold in Domestic Tariff Area. Petitioners are also paying additional duty, which is known as Countervailing Duty (CVD) under Section 3 of the Customs Tariff Act, 1975, which is equivalent to the excise duty for the time being leviable on a like article, if produced or manufactured in India. Petitioners were exempted, however, by Circular No. 38/2000, the Commissioners of Customs were requested to recover short levy by reviewing the D.T.A. clearance made by plastic processors like the petitioners. It is this Circular Annexure A dated 10th May, 2000, which is the subject matter before the Court. 4. Annexure A refers to following aspects : - (i) That a doubt was raised regarding levy of additional duty of customs (CVD) on DTA sale of reproc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... time being in force, on like goods produced or manufactured outside India if imported or manufactured outside India if imported into India, and where the said duties of customs are chargeable by reference to their value; the value of such excisable goods shall, notwithstanding anything contained in any other provisions of this Act, be determined in accordance with the provisions of the Customs Act, 1962 (52 of 1962) and the Customs Tariff Act 1975 (51 of 1975). .. .. Reading Section 3, it becomes very clear that the Revenue is entitled to levy and collect in such manner as prescribed duties of excise on all excisable goods, which are produced or manufactured in Kandla Free Zone and are brought to any other place in India are concerned, they are covered by the proviso to Section 3(1) of the Central Excise Act, 1944. It is the case of the petitioners that they are paying customs duty and excise duty for the goods which they are bringing to other parts of India after manufacturing in Kandla Free Trade Zone, on behalf of the Revenue, the same position is accepted. So far as the countervailing duty is concerned, the petitioners have raised their grievances an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 96. Nil - - Thus plastic materials reprocessed in India out of the Scrap or the waste of goods falling within the Chapters mentioned in the Notification would attract exemption clause as the goods are exempt from the whole of the duty of excise leviable thereon or, in other words, they are chargeable to nil rate of duty. 7. On behalf of the Union of India, it is contended that this exemption could not be claimed by the petitioners, in view of the provisions contained in Section 5A of the Central Excise Act, 1944. The relevant portion of Section 5A with Explanation reads as under :- Section 5A. Powder of grant exemption from duty of excise. - (1) If the Central Government is satisfied that it is necessary in the public interest so to do, it may by notification in the Official Gazette, exempt generally either absolutely or subject to such conditions (to be fulfilled before or after removal) as may be specified in the notification, excisable goods of any specified description from the whole or any part of the duty of excise leviable thereon : Provided that, unless specifically provided in such notification, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Zone and brought in other parts of India, as no exemption is granted from payment of duty under Section 5A. The Petitioners are not claiming exemption from payment of excise duty but are denying their liability to pay countervailing duty under Section 3 of the Customs Tariff Act, in view of the fact that such goods manufactured in India, are not liable to pay any excise duty. From the submission, it transpires that as the petitioners are manufacturing in Kandla Free Trade Zone or EPZ, the officer has called upon to pay the countervailing duty on the ground that the reprocessing has not been done in India. Except this, there is no other valid reason. As a matter of fact, if article is imported into India, the same shall be liable to duty equal to excise duty for the time being leviable on a like article if produced or manufactured in India. It is an admitted position that on like article, there is no excise duty, may be because of exemption. Now, turning to the Circular, it appears that the Revenue is of the opinion that two conditions must be fulfilled, viz., reprocessing must have done in India, and the goods must have been manufactured from scrap. So far as the second conditio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Board of Ex. Cus., New Delhi, 2000 (116) E.L.T. 441 (Mad.). 13. So far as the countervailing duty is concerned, the decision of the Apex Court in the case of Hyderabad Industries Ltd. v. Union of India, 1999 (108) E.L.T. 321 (S.C.) is required to be considered. In paragraph 11, the Apex Court has pointed out as under :- .... 11. The words if produced or manufactured in India does not mean that the like article should be actually the explanation if an imported article is one which has been manufactured or produced or manufactured in India. As per the explanation if an imported article is one which has been manufactured or produced, then it must be presumed, for the purpose of Section 3(1) that such article can likewise be manufactured or produced in India. For the purpose of attracting additional duty under Section 3 on the import of a manufactured or produced article the actual manufacture or production of a like article in India is not necessary. As observed by this Court in Thermax Private Limited v. Collector of Customs, Bombay [1992 (61) E.L.T. 352 (S.C.) = (1992) 4 SCC 440] at page 452-453 that Section 3(1) of the Customs Tariff Act specifically mandates t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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