TMI Blog2022 (4) TMI 988X X X X Extracts X X X X X X X X Extracts X X X X ..... NO. IV, NEW DELHI], where the Tribunal has held that when 100% EOU has submitted the permission to sell goods manufactured by them in DTA in accordance with para 9.9 of the Exim Policy, the Government cannot go beyond such permission and dispute the value of clearance allowed by the Competent Authority which in that case is Development Commissioner. Thus, it is clear that value of deemed export have also to be included for computing (FOB) value of exports. Following the same, the demand raised alleging that appellant has exceeded DTA sale entitlement is without any basis. The demand cannot sustain on merits. Extended period of limitation - HELD THAT:- The entire details are available in the records. Further they have made several requests before the Development Commissioner showing their clearances and to include the deemed exports for computing DTA sale entitlement - first SCN for the period 1999-2000 issued invoking the extended period cannot sustain and has to be held as time-barred. Appeal allowed - decided in favor of appellant. - EXCISE APPEAL NO.258 of 2009 AND EXCISE APPEAL NO.284 of 2011 - FINAL ORDER No. 40141-40142 / 2022 - Dated:- 21-4-2022 - Ms. Sulekha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 32,87,981/- for the period 1999-2000 and 2000-2001 and ₹ 11,33,862/- for the period January to March 2002 respectively on the ground that the appellant has made excess DTA clearance of ₹ 83,94,770/- and ₹ 52,69,176/- over and above their DTA Sale Entitlement respectively and the appellant is not entitled to include the deemed exports made by them in the FOB Value of exports for the purpose of DTA Sale Entitlement in terms of Circular dated 7.4.2000. 2.3. The details of DTA Sale Entitlement, DTA Sales made and Deemed exports made during the period of demand covered under the above said first SCN are as follows: Year DTA sale Entitlement /Allowed Actual DTA Sales made Excess DTA sales made Deemed Exports made 1998-99 ₹ 65.83 Lacs ₹ 59.52 lacs Nil ₹ 32.92 lacs 1999-00 ₹ 73.37 Lacs (139.20 -65.83) ₹ 80.73 lacs ₹ 1.05 lacs ₹ 32 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner shall consider all such contentions in accordance with law. 2.7. Commissioner had adjudicated the first SCN vide his Order in Original No.2/2009 dated 30.1.2009 confirmed differential duty of ₹ 30,23,254/- along with interest by holding that the appellant has made excess DTA sales and the DTA Sale Entitlement cannot be determined based on deemed exports. He also rejected the plea of time bar and imposed equal penalty under Rule 173Q of CER. 2.8 In the meanwhile, the appellant had written to the Development Commissioner (DC) vide their letter dated 22.12.2008 and requested for considering the deemed exports value for the purpose of DTA Entitlement by relying on the decision of the Hon ble Tribunal in the case of Ginni International which has been upheld by the Hon ble Apex Court. The DC vide its letter dated 23.3.2009 denied the request of the appellant in view of the clarification dated 26.12.2008 issued by the Ministry of Commerce. The appellant challenged the above letter dated 23.3.2009 vide a Writ Petition No. 12794 of 2010 before the Hon ble High Court of Madras the Court vide its order dated 3.11.2010 directed the appellant to file an appeal against t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urther, in the case of Amitex Silk Mills Pvt Ltd - 2006 (194) ELT 344 (Tri Del) the identical issue was in consideration and in view of difference in opinion, the matter was referred to third member who had held similarly as held by the Apex Court in the Virlon Textiles and held that the Revenue has no reason to exclude the deemed exports while computing FOB value of Exports and the Revenue was in error in excluding the value of deemed exports. Both the above decisions of the Hon ble Tribunal was challenged by the Revenue before the Apex Court and such appeals were dismissed by the Apex Court on 16.8.2007 by holding that the matters are squarely covered by the decision in the case of Virlon Textiles. 2.13 The appellant also wishes to place reliance on the following decisions which also squarely applies to the issue on hand. a) 2015 (321) ELT 436 (Guj) Sabnam Synthetics - which has been approved by the Hon ble Supreme Court 2015 (321) ELT A199 (SC) b) 2011 (269) ELT 17 (Guj) Shilpa Copper Wire Ind which has also been approved by the Hon ble Supreme Court 2018 (361) ELT A84 (SC) c) 2017 (346) ELT 461 (Tri Ahd) Shree Rohini Enterprises which has also been app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal may be allowed. 4.1 Ld. A.R Ms. Sridevi Taritla supported the findings in the impugned order. She explained that as per para-9.9 (b) of EXIM Policy 1997-2002, the assessee is entitled to sell the final products upto 25% of value of production into Domestic Tariff Area that was amended to 50% of FOB value of exports from 1999-2000 onwards. For this purpose, the appellant had obtained permission from the Development Commissioner, MEPZ, Chennai who is the statutory authority to determine the DTA entitlement. The goods can be sold in DTA only on payment of applicable duties. 4.2 As per para (f) of guidelines of sale of goods in DTA, the DTA sale entitlement shall accrue only after the goods are physically exported during the relevant period as intimated to the Development Commissioner. However, on request made by the appellant, the Development Commissioner had permitted advance DTA sale for a total value not exceeding ₹ 65.83 lakhs for the year 1998-99 vide letter dt. 08.10.1998 which included the value of ₹ 82,125/- which had already been permitted. As per the guidelines, apart from the advance DTA sales permission for ₹ 65.83 lakhs as stated above, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter deducting the FOB value of ₹ 2,38,08,904/- from the above said amount, the balance FOB value is ₹ 40,76,553/-. For such amount, DTA entitlement at the enhanced rate of 50% FOB value for the year 1999-2000 is only ₹ 20,38,276/- whereas the actual DTA sale effected by the appellant is ₹ 1,04,33,046/- for the period 1999-00 and 2000-01 Thus, there is excess DTA sale of ₹ 83,94,770/-. The duty liability on this excess DTA sale is worked out to be ₹ 32,87,981/-. 4.6 Appellant had also cleared cotton yarn to another 100% EOU. They requested to consider the said clearances made to other EOUs as deemed export . This has not been permitted by the Development Commissioner. In terms of Circular F.No.305/48/2000 FTT dated 7.4.2000 issued by CBEC, New Delhi, the deemed export cannot be considered as par with the exports made to foreign buyers and therefore such clearances were not taken into account for arriving at the entitlement for sales at concessional rate for DTA clearances. The demand confirmed is therefore legal and proper. 5. Heard both sides. 6. First issue that arises for consideration is whether the quantification of DTA sale value i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods in DTA against the Deemed Export? 2. This Court has issued notice on 29-1-2010 for final disposal making it returnable on 5-2-2010. An 29-1-2010 when Mr. Sanjay Sharma, full-time paid employee of the assessee was present. He informed that the authorized signatory of the assessee is not available for the week and hence the notice could not be served. Mr. Bhatt, however, submitted that issue involved in this Tax Appeal is similar to one which is involved in Tax Appeal No. 968/2008, which is being heard today. We have, therefore, considered Mr. Bhatt's submission even for this appeal too. Since Mr. A. Suryanarayan is appearing in Tax Appeal No. 968/2008, his submission on law point are considered even for this appeal. 3 . It is the case of the Revenue that the Adjudicating Authority, after issuing the show cause notice and after considering the reply filed on behalf of the respondent-Assessee and after considering the submissions made by the learned Counsel appearing for the respondent-Assessee, has passed the Order-in-Original on 2-11-2001 directing the respondent-Assessee to pay an amount of ₹ 15,12,661/-, in terms of Section 11A(2) of the Central Excise Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , dismiss this Tax Appeal. 8. The above decision was affirmed by the Hon ble Supreme Court as reported in Commissioner Vs 2015 (321) ELT A199 (SC). The Hon ble Apex Court while dismissing the SLP relied upon their decision in the case of Virlon Textiles Mills Ltd. Vs CCE Mumbai reported in 2007 (4) SCC 440. 9. The jurisdictional High Court vide judgement dt. 14.7.2021 quoted para -7 from the judgement in the case of Virlon Textiles Mills Ltd. (supra) and directed the Tribunal to look into the applicability of the said decision with reference to the facts and circumstances of the case. 10. In the case of CCE Vs Shilpa Copper Wire Industries - 2011 (269) ELT 17 (Guj.) similar view was taken . Relevant para is reproduced as under : 14 . We have heard the learned Counsel appearing for the parties and after considering their submissions, we are of the view that the issue raised by the Revenue in the present Tax Appeal is squarely covered by the decision of Amitex Silk Mills Pvt. Ltd. (supra), Commissioner of Central Excise v. Ginni International Ltd. and Sanghi Textiles Ltd. v. Commissioner of Customs Central Excise - 2006 (206) E.L.T. 854 (Tri.- Bang.). So far as the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any substantial error of law in dismissing the appeal of the Revenue and confirming the order of the learned Commissioner (Appeals) holding that the clearances made by one 100% EOU to another 100% EOU which are deemed exports are to be treated as physical exports for the purpose of entitling refund of unutilized Cenvat credit contemplated under the provisions of Rule 5 of the Cenvat Credit Rule, 2004. 17 . We, therefore, hold that Tribunal is justified and has not substantially erred in law in dismissing the appeal of the Revenue and confirming the order of the learned Commissioner (Appeals) granting the refund of ₹ 5,21,009/-. 18 . This appeal is, therefore, dismissed without any order as to costs. 11. The said decision was upheld by the Hon ble Apex Court reported in 2018 (361) ELT A84 (SC). 12. The Tribunal in the case of Shree Rohini Enterprises - 2017 (346) ELT 461 (Tri-Ahmd.) held that value of deemed export is to be treated as export sale determined on FOB value of export. The same was confirmed by the Supreme Court reported in 2017 (346) A137 (SC). 13. From the decisions cited above, it is clear that value of deemed export have also to be included f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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