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2015 (11) TMI 137 - SUPREME COURT

2015 (11) TMI 137 - SUPREME COURT - 2015 (325) E.L.T. 236 (SC) - Duty demand - exemption in terms of Notification No. 53/97-Cus or Notification No. 1/95-CE. - 100% EOU - Invocation of extended period of limitation - Held that:- It is not necessary that the material which is imported into India has to be used in the manufacture of articles which are to be exported out of India. Even if the said material is used "for the purpose of manufacture of articles" or "for being used in connection with the .....

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BR> Goods are used for the purpose for which they are imported. If the perception of the Revenue was that these are not captive goods or the benefit of Notification No. 53/97 is not available to the assessee, the period of limitation started at the threshold and therefore, on the facts which were known to the Revenue the Show Cause Notice could have been issued within a normal period of limitation prescribed under Section 28 which was six months at the relevant time. - Decided in favour of asse .....

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ntral Excise Tariff Act, 1985. It is a 100% EOU unit and with that character, the appellant is entitled to import raw material as well as capital goods and other goods specified in the EXIM policy and Custom Notification No. 53/97-Cus dated 03.06.1997 without payment of duty. It is also an admitted case that as a 100% EOU, the appellant is also entitled to procure raw materials, capital goods and all other goods specified in the EXIM policy under the Excise Notification No. 1/95-CE dated 04.01.1 .....

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ection with the production of the aforesaid items and therefore, no duty was paid. The Revenue, however, was of the opinion that some duty free items claimed by the appellant as capital goods were used for construction and decoration of the factory building and therefore, were not entitled to the exemption in terms of Notification No. 53/97-Cus or Notification No. 1/95-CE. It resulted in the issuance of Show Cause Notice dated 27.03.2002 and the demand mentioned in the said notice was confirmed .....

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t contumacious. We would also like to state here that the Show Cause Notice dated 23.07.2002 was beyond the normal period of limitation prescribed under Section 28 of the Customs Act and therefore, provisions of proviso to that Section was invoked to claim the extended period of limitation. The appellant had specifically raised the issue that the notice was time barred and it was not permissible for the Revenue to seek shelter under the proviso to Section 28 inasmuch as there was no misdeclarati .....

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bound to pay the duty occurring on account of any flout, if noticed subsequently, of provisions of Notifications. Hence the demand made in this case is not hit by any time bar." In order to determine the aforesaid issue, it would be necessary to traverse through Exemption Notification No. 53/97-Cus. dated 03.06.1997 as amended from time time. Relevant portion thereof with which we are concerned reads as under: - "In exercise of the powers conferred by sub-section (1) of Section 25 of .....

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with the production or packaging or job work for export of goods or services out of India or for trading of goods for export out of India as referred to in paragraph 9.21 of the Export & Import Policy, 1997-2002 notified by the Government of India under the Ministry of Commerce Notification No. 1/97, dated the 31st March, 1997, as amended from time to time (hereafter referred to as the said Export and Import Policy) by hundred percent Export Oriented Units approved by the Board of Approvals .....

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oms Tariff Act subject to the following conditions......" A reading of the aforesaid notification clearly manifests that it is not necessary that the material which is imported into India has to be used in the manufacture of articles which are to be exported out of India. Even if the said material is used "for the purpose of manufacture of articles" or "for being used in connection with the production or packaging or job work", the same shall still be covered by the afor .....

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