TMI Blog2016 (3) TMI 380X X X X Extracts X X X X X X X X Extracts X X X X ..... t Flowers. If at all any duty liability is there it should be on the imported goods which is used for production, manufacture or packaging of cut flowers. In the instant case, it is not case of Revenue that the appellant have used any imported material for growing or packaging of cut flowers. Therefore there is no question of any demand of customs duty. In any case, the demand was confirmed by the original adjudicating authority in terms of Notification No. 126/94-Cus. on the cut flowers as discussed above. Cut flower being non-excisable goods, neither any excise duty nor any customs duty is required to be paid. We are of the considered view that demand of duty on the Cut Flowers grown/produced in India and cleared in DTA is not chargeable, therefore the impugned order is sustained as cut flowers cleared by 100% EOU in DTA does not attract any duty. - Decided in favour of assessee - E/455-459/2005-Mum - Final Order Nos. A/2454-2458/2015-WZB/EB - Dated:- 5-8-2015 - Shri P.K. Jain, Member (T) and Ramesh Nair, Member (J) Shri N.N. Prabhudesai, Superintendent (AR), for the Appellant. Shri V.M. Doiphode, Advocate, for the Respondent. ORDER [Order per : Ramesh N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation No. 126/94-Cus. It is his submission that where duty free imported goods are used in finished articles, which have not been exported, according to para (3) of Notification No. 126/94-Cus., dated 3-6-1994 which clearly sets out that where the articles manufactured by 100% EOU are not excisable, are to be sold in India on payment of Customs Duty on the said goods used for the purpose of production, manufacture or packaging of such articles in an amount equal to the customs duty leviable on such articles as if imported as such. Under this legal position, the respondent is liable to pay customs duty on the Cut Flowers sold in DTA. The ld. Commissioner (Appeals), therefore, erred in holding that duty cannot be demanded in respect of Cut Flowers grown by 100% EOU and cleared for DTA sales and also the product being non-excisable the demand of Central Excise duty is not sustainable. In support of his submissions, ld. AR placed reliance on the following judgments : 1. CCE, Pune v. Horizon Flora India Ltd. - 2013-TIOL-203-CESTAT-Mum = 2015 (323) E.L.T. 177 (Tri.-Mum.). 2. L.R. Brothers Indo Flora Ltd. v. CC, Meerut - 2009 (235) E.L.T. 324 (Tri.-Del.). Ld. AR submits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 (315) E.L.T. 89 (Tri.-Mum.)]. 5. We have carefully considered the submissions made by both sides and perused the records. 6. The issue to be decided by us is that, whether customs duty is chargeable on fresh cut flowers grown and cleared by the appellant in DTA in terms of Notification No. 126/94-Cus., dated 3-6-1994 or otherwise. Since the whole issue revolving the Notification No. 126/94-Cus., it is necessary to first go through the said notification, the relevant paras of the Notification is reproduced below : Notwithstanding anything contained in this notification, the exemption contained herein shall also apply to the said goods which on importation into India are used for the purposes of production, manufacture or packaging of articles and such articles (including rejects, waste and scrap material arising in the course of production, manufacture or packaging of such articles) even if not exported out of India are allowed to be sold in India under and in accordance with the Export-Import Policy and in such quantity and subject to such other limitations and conditions as may be specified in this behalf by the Development Commissioner, on payment of duty of excise lev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustoms duty is required to be paid. 6.2 This issue has been considered in number of judgments as cited by the rivals. Relevant paras of the cited judgments are reproduced below : Abbound Bio-Agri Technologies Ltd. 4. We have carefully considered the submissions made by both the sides. Notification 126/94 grants exemption to inputs imported for the production, manufacture or packaging of articles for export purposes. One of the conditions stipulated for availing the benefit of exemption is that if the articles which are manufactured/produced are not excisable and are not exported, then customs duty can be demanded on the imported inputs used for the purpose of production and manufacture of such articles in an amount equal to the customs duty leviable on such articles as if they are imported as such. In other words, the duty demand is on the imported inputs and not on the articles which have been produced and such duty is demandable at the time of clearance of the non-excisable articles into DTA. Notification does not permit demand of duty on the articles manufactured/produced in India when cleared into DTA. In the present case, the show cause notice proposes to demand exc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the observation of the learned Commissioner (Appeals) that when the goods are not excisable, demand under the Central Excise Act is not sustainable. Therefore, we do not find any merits in the appeals filed by the Revenue. Accordingly, the same are dismissed. In another case of this Tribunal, similar judgment was passed which is extracted below in case of Neha International Ltd. (supra). 2. The facts are that the respondent cleared Cut Flowers grown by their 100% EOU, into Domestic Tariff Area (DTA). The case of the respondent was that they have not availed any concession on indigenous inputs/raw materials and also did not use any imported inputs/raw materials. The Commissioner (Appeals) held that cut flowers are non-excisable and neither Customs duty nor Central Excise duty is demandable on the cut flowers cleared into DTA. The Commissioner (Appeals) relied on Vikram Ispat v. CCE, Mumbai-III - 2000 (120) E.L.T. 800 (Tri.-LB) in which it was held that Customs duty is not leviable on DTA sales and only Central Excise duty can be charged under Section 3 of the Central Excise Act, 1944 in respect of the DTA clearances by 100% EOUs. He also relied similarly on Cosco Blossoms Pv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... % EOU is duty of excise. In this case the goods namely cut flowers are non-excisable. The judgments cited by the Commissioner support this obvious interpretation of Section 3. Revenue s appeals on the ground that the Notification provides otherwise is not acceptable because a Notification cannot override the basic provision of law for charging duty. Revenue s reference to Cosco Blossoms Pvt. Ltd. (supra) to justify the duty can be demanded on imported inputs is totally misplaced and uncalled for because what was demanded in the show cause notice is Central Excise duty. 6. In view of the above, Revenue s appeals are dismissed. Cross-Objections filed by the respondent are also disposed of in the above terms. From above judgments it can be seen that very same issue involved in the present case has been elaborately dealt and this Tribunal consistently held that the cut flowers cleared by 100% EOU in DTA does not attract any duty. 6.3 As regard the judgment relied upon by the Revenue, going through those judgments, we find that in case of Horizon Flora India Ltd. (supra), the same has been distinguished in the case of Soex Flora P. Ltd. (supra). As regard the judgment of L.R. B ..... X X X X Extracts X X X X X X X X Extracts X X X X
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