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M/s Moonlight Exim (P) Ltd. Versus CCE, Jaipur

2016 (11) TMI 676 - CESTAT NEW DELHI

Demand - EOU - export obligation - N/N. 53/1997-Cus. dated 3.6.1997 - whether the charge against the appellant that non-fulfilment of the conditions under Notification No. 53/1997 and the conditions of the bond executed at the time of setting up the EOU is justified? - Held that: - The impugned order has not given the proportionate benefit of the exports made by the appellant though it is a fact that their net foreign exchange earnings are not positive. However, considering the contents of Circu .....

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the foreign exchange. The impugned order did not give the assessee appellant the benefit of exports saying that they did not produce any documentary evidence showing realization of export proceeds. The duty liability against the appellant is only to the extent of the gap between the foreign exchange realised on the exports made and the foreign exchange outgo for the imports made by the appellants as per the clarifications in the Circular No. 29/2003-Cus. and the contents of the N/N. 52/2003-Cus. .....

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n exchange realised though for which they had not produced the documentary evidence before the adjudicating authority. - Impugned order set aside - matter remanded back to the Commissioner, Central Excise, Jaipur-I who shall decide it afresh in the light of the findings made above within four months of receipt of this order after giving opportunity of personal hearing and that of production of necessary evidence/documents. - Appeal No. C/34/2012-CU.(DB) with C/Misc./51508/2016 - Final Order .....

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tification No. 53/1997-Cus. dated 3.6.1997. 3. The appellant, an EOU, was granted Letter of Permission (LOP) on 20.13.2000 and was required to export goods of US $ 407.80 lakhs within five years as per LOP. The appellant failed to achieve its export obligation and did not provide any proof of realization of foreign exchange against the exports made. 4. The appellant based on the strength of written submissions inter alia submits as follows: (i) The appellant imported mixed metal scrap which was .....

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been cleared by the appellant on payment of full duties. Therefore, the duty paid by the appellant should be offset against the present demand against them. 4.1 The ld. Advocate for the appellant mentions that they had imported the goods having CIF value of ₹ 377.61 lakhs whereas custom authorities increased it to make the assessable value of ₹ 385.36 lakhs, which at the time of import was not objected to as there was no duty involvement. 4.2 The appellant also pleads that actually .....

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yment of duty in the same proportions as the unachieved portion of Net Foreign Exchange Earnings bears to the positive Net Foreign Exchange Earnings (NFEE) to be achieved along with interest. The Notification No. 52/2003 (supra), in this regard inter alia mentions as follows. The goods imported by respective export oriented undertaking are exempted from whole of duty of customs subject to the following conditions, namely:- (1)............. (2)............... (3) The unit executes a bond in such .....

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payment of such duty, if (i)................ (ii)........... (iii).......... (II) In case of failure to achieve the said positive Net Foreign Exchange Earning, the duty equal in amount to the portion of the duty leviable on the said goods but for the exemption contained in this notification and the duty so payable shall bear the same proportion as the unachieved portion of Net Foreign Exchange Earning bears to the positive Net Foreign Exchange Earning to be achieved along with interest at the r .....

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ld be in proportion to default as was provided in SEZ scheme. This circular makes a mention that notification No. 52/2003-Cus dated 31.3.2003 and also Notification No. 22/2003-CE dated 31.3.2003 incorporates these provisions which govern duty free procurement and import by EOUs etc. 5.2 The appellant has referred to following case laws: (i) Natural Stone Exports Ltd. Vs. CC 2006 (198) ELT 440 (Tri.-Bang.) saying that liability to duty is only in proportionate to non-achieved portion of NEF. (ii) .....

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pur-I. He further inter alia pleads as follows: (i) The Development Commissioner, Noida, Special Economic Zone in his order No. 247/2000 dated 17th Sept, 2009 gave the findings that unit was found NFE negative; unit did not submit APR/QPR since 2005-06 and it did not apply for renewal of LOP which had expired on Feb. 2006. The Development Commissioner in this order dated 17th Sept. 2009 also mentions about Jurisdiction Central Excise to initiate action for recovery of Customs/Central excise duty .....

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s and PW licence. 7. We have carefully considered the facts along with the submissions of both the sides and the case laws cited. 8. The main charge against the appellant which had been sustained in the impugned order is non-fulfilment of the conditions under Notification No. 53/1997 and the conditions of the bond executed at the time of setting up the EOU. The impugned order is mainly based on the following findings: (i) Assessee has shown export of the goods countable towards fulfillment of ex .....

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exchange in terms of para 9.10(b) and 6.5 of EXIM policy and RBI Circular No. 4 dated 31.3.2000 which was countable towards fulfillment of export obligation. In this case the assessee did not produce any documentary evidence showing realization of export proceeds, thus said export valued at ₹ 217.87 lakhs cannot be considered towards fulfillment of export obligation (para 24 of impugned order). (iv) The assessee did not produce any documentary evidence on the receipt of payment in respect .....

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negative and clearly indicate that the assessee had not achieved the positive NEF; thereby the assessee violated the provisions of para 9.5 of EXIM policy, condition No. 1 of Notification No. 53/1997-Cus. dated 3.6.1997 (para 25 of the impugned order). 9. The impugned order has not given the proportionate benefit of the exports made by the appellant though it is a fact that their net foreign exchange earnings are not positive. However, considering the contents of Circular No. 29/2003-Cus dated .....

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ant is entitled to the proportionate benefit of exports made against which they claim to have realized the foreign exchange. The impugned order did not give the assessee appellant the benefit of exports saying that they did not produce any documentary evidence showing realization of export proceeds. The duty liability against the appellant is only to the extent of the gap between the foreign exchange realised on the exports made and the foreign exchange outgo for the imports made by the appellan .....

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