TMI Blog2013 (6) TMI 676X X X X Extracts X X X X X X X X Extracts X X X X ..... clearance of the tractor that the appellants are availing the benefit of Notification 23/2003 which was well within the knowledge of the department. Therefore, the appellants cannot be accused of having suppressed the fact of availing the benefit of Notification 23/2003 without considering the SAD while determining the assessable value. Therefore, extended period of limitation is not invocable in the facts of this case. Accordingly, the demand, beyond the normal period of limitation is set aside. As the allegation of suppression is not sustainable therefore, following the decision of Rajasthan Spinning & Weaving Mills (2009 (5) TMI 15 - SUPREME COURT OF INDIA), penalty imposed under Section 11AC is also not sustainable. Admittedly, the appellant is availing the benefit of exemption from payment of whole of Sales Tax/VAT in respect of its sales of Agricultural Tractors and parts thereof by virtue of the above mentioned order dated 1-4-2005. Consequently, the appellant is not eligible for the benefit of the Notification No. 23/2003-C.E., dated 31-3-2003 - Decided partly in favour of assessee. - E/1665-1666/2012-Mum - Final Order Nos. A/512-513/2013-WZB-CII(EB) - Dated:- 17-6-2013 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s tax exemption benefit. The appellant continued to avail the sales tax benefits given to L T John Deere Pvt. Ltd. without amendment to the Eligibility/Entitlement Certificates. 4. As per Notification No. 23/2003-C.E., dated 31-3-2003 as amended by Notification No. 22/2006-C.E., dated 1-3-2006 for DTA clearance made by an EOU, the effective rate of excise duty payable which was equal to the aggregate of duties of customs was calculated as if : (i) Basic customs duty has been reduced by 50% (earlier 75% upto 12-3-2007) subject to condition No. 2 of the said Notification 23/2003-C.E., dated 31-3-2003. (ii) No Special Additional Duty (SAD) under Section 3(5) of Customs Tariff Act, 1975 is leviable, subject to fulfilment of condition No. 1 which states if the goods being cleared into Domestic Tariff Area are not exempted by the State Government from payment of sales tax. 5. In these set of facts, an investigation took place and it was found that the appellants are clearing tractors and parts thereof in DTA without including the component of 4% SAD while duty arrived at for payments of duty. Such clearance of the goods in DTA without payment of SAD is in contravent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... les exempted from payment of VAT. (iii) Dealers exempted from payment of VAT. (iv) Buyers exempted from payment of VAT. In this case exemption to unit holding certificate under package scheme was available as per Section 8(4) of the MVAT. 8.2 He further submitted that if the goods are not tax free goods within the meaning of Section 2(30) of the MVAT Act, the Condition No. 1 of the Notification stands satisfied irrespective of the fact whether the sale of goods by the appellant does not attract VAT, due to exemption granted to the appellant holding certificate under the Package Scheme of Incentives. As tractors or parts thereof were not exempt from payment of VAT, therefore, the appellant has complied with the condition No. 1 of the Notification No. 23/2003 as amended. Therefore, they have correctly valued the goods. He further submits that the tractors are not tax free goods and sale of tractors by the appellant even from the Depots, attract sales tax/VAT and subsequent purchasers like the dealers of the appellant are also required to make payment of VAT on sale of tractors due to the fact that the tractors are not tax-free goods. He further submitted that the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that while considering the quantity cleared to DTA the export to Nepal has been considered without applying mind to the provisions of Notification No. 24/2003 C.E., dated 31-3-2003. Therefore, he submits that the quantification of differential duty has not been done correctly. He further submitted that the appellant has proved by cogent evidence that there is no suppression of facts or mis-declaration therefore, no penalty can be imposed. To support his contention he relied on the decision in the case of Union of India v. Rajasthan Spinning Weaving Mills - 2009 (238) E.L.T. 3 (S.C.). 8.6 With these submissions he prayed that impugned orders are to be set aside. 9. On the other hand, Shri K.M. Mondal, Spl. Counsel strongly opposed the contention of the learned Counsel and submitted that as per the declaration made by the appellant in the invoices and Certificate of Entitlement, there cannot be in any manner of doubt that the sales of agricultural tractors and parts thereof are wholly exempt from payment of sales tax. Consequently, the appellant is not eligible for the benefit of Notification No. 23/2002, dated 31-3-2003 which exempts SAD subject to fulfilment of the conditio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... OU having their unit in the area specified by the State Government of Uttar Pradesh for the purposes of concession from payment of sales tax/VAT, they are engaged in the manufacture of CDR, CD ROM, DVDR. DVD ROM falling under Chapter Heading 8523 of the Central Excise Tariff. The appellant has been issued with an eligibility certificate on 30-7-2002 for availing the exemption from Sales Tax/VAT available for units set up in specified backward area. The appellant sold part of their goods in DTA on payment of concessional rate of duty in terms of Notification No. 23/2003-C.E., dated 31-3-2003. Such goods cleared in DTA were exempt from Sales Tax. The State Government asked the appellant to set up a factory in a backward area to foster industrialization. The appellants have been granted certain incentives by the State Government to set up their unit in the specified backward area. To enable them to compete against industries in the forward area, incentives in the form of waiver of sales tax levied was granted and the amount of the sales tax assessed is deducted from the total amount of the incentive. Therefore, the goods cleared by them to DTA were exempt from Sales Tax. The domestic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2007 (216) E.L.T. 177 (S.C.), we are of the view that extended period cannot be applied for the recovery of non-duty paid and only the normal period of limitation would be applicable. 13.2 In the present case the appellant has declared to the department before the first clearance of the tractor that the appellants are availing the benefit of Notification 23/2003 which was well within the knowledge of the department. Therefore, the appellants cannot be accused of having suppressed the fact of availing the benefit of Notification 23/2003 without considering the SAD while determining the assessable value. Therefore, extended period of limitation is not invocable in the facts of this case. Accordingly, the demand, beyond the normal period of limitation is set aside. As the allegation of suppression is not sustainable therefore, following the decision of Rajasthan Spinning Weaving Mills (supra), penalty imposed under Section 11AC is also not sustainable. As the duty is payable, interest is also payable. 14. We further find that the appellant has not recovered any amount over and above the value shown in the invoice, therefore, the value shown in the invoice shall be treated as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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