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TMI Blog2018 (1) TMI 1166X X X X Extracts X X X X X X X X Extracts X X X X ..... the said notification does not specify clearances made to SEZ. SNCs were raising the above allegation and proposing to demand differential duty along with interest and also for imposing penalties. After due process of law, the Commissioner confirmed the demand, interest and imposed penalties. Aggrieved, appellants are before the Tribunal. 2. On behalf of the appellants, the Ld. Counsel, Shri Joseph Prabakar submitted that the clearances made to SEZ are to be treated as exports. The finished products manufactured by them are not exempted products but are exempted from duty as the clearances made to SEZ are to be treated as exports. That therefore the appellants are eligible for exemption. He adverted to the Notification No. 67/1995 and submitted that as per clause (1) of the said notification, the clearances made to free trade zone will be considered for eligibility under the notification even though the final goods are cleared without payment of duty. That the said sub-clause was amended by way of substitution w.e.f. 14/06/2016, vide Notification No. 25/2016-CE and the words Free Trade Zone was substituted by the words Special Economic Zone . Whenever there is an amendment brought ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emption to all capital goods and specified inputs if captively consumed within factory of production. - In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excises and Salt Act, 1944 (1 of 1944), read with sub-section (3) of Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957), (hereinafter referred to as the said Special Importance Act),] the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts - (i) capital goods as defined in the Cenvat Credit Rules, 2002 manufactured in a factory and used within the factory of production; (ii) goods specified in column (1) of the Table hereto annexed (hereinafter referred to as inputs ) manufactured in a factory and used within the factory of production in or in relation to manufacture of final products specified in column (2) of the said Table : Provided that nothing contained in this notification shall apply to inputs used in or in relation to the manufacture of final products which are exempt from the whole of duty of excise or additional duty of excise leviable thereon or are chargeable to nil rate of duty, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and demanded duty on the clinkers used in the manufacture of cement which are cleared to SEZ units/developers. We find this very issue has been clearly discussed by the Tribunal Principal Bench in the case of Surya Roshni (supra). Relevant paragraphs are reproduced as under : 5. We have considered that rival submissions. There is no dispute that common Cenvat credit availed inputs have been used in the manufacture of goods supplied to DTA buyers on payment of duty and also in respect of the goods supplied to SEZ Developers without payment of duty. The point of dispute is as to whether the goods supplies to SEZ Developers without payment of duty are to be treated as exempted goods within the meaning of this term as defined in Rule 2(d) of the Cenvat Credit Rules, 2004 and whether in respect of these supplies, the provisions of sub-rules (2) and (3) of Rule 6 ibid would be applicable. 6. The term exempted goods as defined in Rule 2(d) in Cenvat Credit Rules means excisable goods which are exempted from the whole of the duty leviable thereon including the goods which are chargeable to nil rate of duty. There is no dispute about the fact that neither the goods, in question, are cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tification No.67/95-C.E. is an exception clause where a manufacturer of dutiable and exempted goods is eligible if he discharges the obligation prescribed in Rule 6 of Cenvat Credit Rules, 2001. As rightly submitted by both Revenue and the appellants, there is no definition of exempted goods in Central Excise Act except Rule 2(d) of Cenvat Credit Rules. The Tribunal s decision in the case of Surya Roshni (supra) discussed above clearly answers the above question. When the words exempted goods used in the said notification, it only means final products exempted under the Central Excise Act read with Central Excise Rules or any notification issued thereunder . 25. Revenue contended that Section 26(1)(c) of the SEZ Act clearly exempts the goods supplied by the DTA to SEZ units/developers and this should be considered while construing the proviso to Notification No.67/95-C.E. This proposition of the Revenue is not acceptable and the word used in the proviso to Notification No. 67/95-C.E. is dutiable and exempted final products in relation to Cenvat Credit Rules, 2001. The Cenvat Credit Rules is to enable availment of Cenvat credit of excise duty or any other duties specified under th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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