TMI Blog2017 (6) TMI 1066X X X X Extracts X X X X X X X X Extracts X X X X ..... the SEZ Act shall prevail over the definition of term “export” under the Customs Act. Therefore, supplies made to SEZ from DTA units shall be treated as export, supplies made to SEZ are held to be “export” provisions of Rule 6 of CCR does not arise at all. Appeal allowed - decided in favor of appellant. - E/409/2011 - A/87514/17/SMB - Dated:- 26-5-2017 - Shri Ramesh Nair, Member (Judicial) Shri Prasad Paranjape, Advocate for Appellant Shri N.N. Prabhudesaid, Supdt. (A.R.) for respondent ORDER The case of the department is that the appellants had not reversed an amount equal to 10% of value of the finished goods from the cenvat account, at the time of clearance from the factory in respect of the goods cleared to SEZ Developers and SEZ Co-Developers namely Magarpatta Township Development and Construction in terms of Rule 6(3) (b) of the Cenvat Credit Rules, 2004 during the period January 2008 to December 2008, on the premise that in terms of Section 2(m) of SEZ Act clearance of goods or providing service from DTA to SEZ unit or SEZ developer constitutes export . The adjudicating authority as well as first appellate authority did not agree with the contentio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which are chargeable to duty as well as exempted goods, then, the manufacturer shall maintain separate accounts for receipt, consumption and inventory of inputs meant for use in the manufacture of dutiable final products and the quantity of inputs meant for use in the manufacture of exempted goods and take CENVAT credit only on that quantity of inputs which is intended for use in the manufacture of dutiable goods. (3) The manufacturer, opting not to maintain separate accounts shall follow either of the following conditions, as applicable to him, namely :- (a) if the exempted goods are - 1 to 8 .. the manufacturer shall pay an amount equivalent to the CENVAT credit attributable to inputs used in, or in relation to, the manufacture of such final products at the time of their clearance from the factory; or (b) if the exempted goods are other than those described in condition (a), the manufacturer shall pay an amount equal to eight per cent of the total price, excluding sales tax and other taxes, if any, paid on such goods, of the exempted final product charged by the manufacturer for the sale of such goods at the time of their clearance from the fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... input or input service which is intended for use in the manufacture of dutiable goods or in providing output service on which Service Tax is payable. (3) Notwithstanding anything contained In sub-rules (1) and (2), the manufacturer of goods or the provider of output service, opting not to maintain separate accounts, shall follow either of the following options, as applicable to him, namely : - [(i) the manufacturer of goods shall pay an amount equal to five per cent of value of the exempted goods and the provider of output service shall pay an amount equal to six per cent of value of the exempted services; or] (ii) the manufacturer of goods or the provider of output service shall pay an amount equivalent to the CENVAT Credit attributable to inputs and input services used in, or in relation to, the manufacture of exempted goods or for provision of exempted services subject to the conditions and procedure specified in sub-rule (3A). Explanation I - If the manufacturer of goods or the provider of output service, avails any of the option under this sub-rule, he shall exercise such option for all exempted goods manufactured by him or, as the case may be, all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n respect of clearances made for export under bond and also in respect of goods cleared to a unit in SEZ. If the supplies made to SEZ are treated as supply of dutiable goods, then the question of present assessees manufacturing both dutiable and exempted goods does not arise and therefore, the provisions of Rule 6 of Cenvat Credit Rules, 2002/2004 are not at all attracted. The question of applying exception arises only when the supplies are treated as exempted goods. 9.3 Insofar as Rule 6 (6) relating to the SEZ was concerned, the same was amended w.e.f. 31-12-2008. The provisions prior to amendment was : The provisions of sub-rule (1), (2), (3) and (4) shall not applicable in case the excisable goods removed without payment of duty (1) cleared to a unit in SEZ. The provisions after amendment was : The provisions of sub-rule (1), (2), (3) and (4) shall not applicable in case the excisable goods removed without payment of duty or either cleared to a unit in SEZ or to a developer of SEZ for their authorized operations. 9.4 According to the Department the amendment effective from 31-12-2008 Rule 6 of Cenvat Credit Rules, 2004 is enlarging the scope of exce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10.3 In the case of India Tobacco Association, Hon ble Supreme Court invoking the doctrine of fairness for treating the amendment retrospective in para 28 held as under :- 28. The doctrine of fairness also is now considered to be a relevant factor for construing a statute. In a case of this nature where the effect of a beneficent statute was sought to be extended keeping in view the fact that the benefit was already availed of by the agriculturists of tobacco in Guntur, it would be highly unfair if the benefit granted to them is taken away, although the same was meant to be extended to them also. For such purposes the statute need not be given retrospective effect by express words but the intent and object of the legislature in relation thereto can be culled out from the background facts. 10.4 In the case of Zile Singh v. State of Haryana Ors, the Hon ble Supreme Court held that the substitution of one text for the other pre-existing text is one of the known and well-recognized practices employed in legislative drafting and Substitution has to be distinguished from supersession or a mere repeal of an existing provision. It has been further held that the process ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Credit Rules, 2004 shall be applicable to supply of exempted goods both to SEZ units and SEZ developers/promoters. e. Appeals of the assessees deserve to be allowed and the appeals of the Department deserve to be rejected. f. Incidentally, in the facts and circumstances of the case, the question of invoking extended period of limitation for demand of amounts and imposition of penalties does not arise. 14. Accordingly the appeals of the assessees are allowed with consequential relief as per law and the appeals of the Department are rejected. Cross Objection No. E/CO/02/2010 is also disposed off. (ii) Lotus Power Gears (P) Ltd. (supra) held that 5. When the issue is already covered by the decision of this Court, it cannot be said that any questions of law would arise for consideration as sought to be canvassed. (iii) Dee Development Engineers Pvt. Ltd. (supra) held that 2. At the very outset, it was not disputed by learned counsel for the parties that identical issue was gone into by three different High Courts in Commissioner of Central Excise Customs, Raipur v. M/s. Steel Authority of India Ltd., Bhilai Steel Plant, Bhilai, 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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