TMI Blog2017 (7) TMI 438X X X X Extracts X X X X X X X X Extracts X X X X ..... relook on all the issues - appeal allowed by way of remand. - E/362, 363/07, E/88587 to 88589, 88591/13 & E/88600 to 88602/13 - A/88053-88061/17/EB - Dated:- 19-6-2017 - Shri Ramesh Nair, Member (Judicial) And Shri Raju, Member (Technical) Shri E.P. Bharucha, Sr. Advocate, Shri Cylrus Bharucha, Advocate with Shri S. Kalambai, Advocate for Appellant/Respondent Shri V.K. Agarwal, Addl.Commr. (A.R.) for Respondent/Appellant ORDER Per: Ramesh Nair The facts of the case are that the appellant is a 100% EOU engaged in the manufacture of excisable goods mainly Absorbent Cotton falling under Chapter sub-heading No.56012110 of the First Schedule to the Central Excise Tariff Act, 1985. They imported 100% Cotton Comber No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng generated during the manufacture waste the same is arising before manufacture of the Absorbent Cotton therefore the same is not excisable goods not liable to excise duty. He submits that the Commissioner erred in going beyond the show cause notice inasmuch as the order seeks to recover duty from the appellant on breach of notification No. 53/97-Cus dt. 3.6.1997 and Notification No. 52/03-Cus dt. 31.3.2003 when the same was not the basis of demand in the show cause notice. The Commissioner has considered total quantity of 1,61,90,067 Kgs of Comber Noil as imported under Notification No. 53/97-Cus. dt. 3.6.1997 and notification No.52/2003-Cus. dt. 31.3.2003 and used the same in the manufacture of 1,33,62,763Kgs. of Absorbent Cotton whereas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er has wrongly interpreted the term allowed to be sold in India since there is no prohibition in sale of cotton wastes/droppings in India, it does not mean that the permission is required to sale in India. During the period 2001 to 2003 no permission of the Development Commissioner was required for the purpose of selling cotton wastes of the droppings in Domestic Tariff Area. In this regard, the Commissioner erred in ignoring para 9.20 and Para 6.8 (d) of the EXIM Policy as existing during the period 2001-2002, and 2002-2003 respectively which entitles sale of waste/scrap in the DTA and it did not provide for any specific permission of the Development Commissioner. The only condition in respect of sale in DTA is that it should be within the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company was granted DTA entitlement certificates as under: For Year Ending Rs. Crores (approx) 31.3.2001 6.23 31.3.2002 9.49 31.3.2003 14.23 29.95 From the above, it is apparent that the domestic sales were very negligible, only 1.13% of FOB and much below the 50% of FOB prescribed in the EXIM Policy for various years. He submits that since the DTA sale was well within the permissible limit even if permission was required, without the permission the sale of the goods is only a procedural lapse and the same shoul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re of final products. During the course of audit all the activities of the appellant including the sale of cotton droppings/wastes were examined and this itself established knowledge on the part of the department therefore the demand raised in the show cause notice is clearly time barred. In support of his submission he placed reliance on the following decisions: (i) C.T. Cotton Yarn Ltd. Vs. Commissioner of Central Excise, Indore 2012 (284) E.L.T. 572 (Tri.-Del.) (ii) Indian Aluminium Co. Ltd. and Another Vs. A.K. Bandyopadhyay and Others 1980 E.L.T. 146 (Bom.) (iii) Uniworth Textiles Ltd. Vs. Commissioner of Central Excise, Raipur (2013) 9 Supreme Court Cases 753 (iv) Union of India Vs. Indian Aluminium Co. Ltd. 1995 (7 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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