TMI Blog2022 (10) TMI 425X X X X Extracts X X X X X X X X Extracts X X X X ..... not payable. Subsequently, when the goods are sold by the DTA unit of the appellant VAT becomes payable. What is important for the Notification No. 23/2003 to be applicable is that VAT should not be exempted on those goods. Undisputedly, there was no exemption from VAT in this case. The mere fact that the payment of VAT does not happen concomitantly with the clearance of the goods does not mean that the VAT is exempted. The appellant is not liable to pay Central Excise duty reckoning the SAD payable on goods cleared by the appellant if they were imported into India - Appeal allowed - decided in favor of appellant. - EXCISE APPEAL NO. 52673 OF 2018 AND EXCISE APPEAL NO. 52681 OF 2018 - FINAL ORDER NOs. 50691-50692/2022 - Dated:- 25-7-2022 - MR. DILIP GUPTA, PRESIDENT AND MR. P.V. SUBBA RAO, MEMBER (TECHNICAL) Shri Dhruv Tiwari Advocate - for the Appellant Shri Sanjay Kumar Singh, Authorised Representative for the Respondent ORDER These two appeals are filed on the same issue and hence are being disposed of together. The issue which falls for consideration is in a case where a 100% EOU transfers goods which are chargeable to VAT to its own Domestic Tarif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to as the Central Excise Act), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts excisable goods of the description specified in column (3) of the Table below, and falling within the Chapter, heading No. or sub-heading No. of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) (hereinafter referred to as the Central Excise Tariff Act), specified in the corresponding entry in column (2) of the said Table, produced or manufactured in an export oriented undertaking or an Electronic Hardware Technology Park (EHTP) Unit or a Software Technology Park ( STP) Unit and brought to any other place in India in accordance with the provisions of Export and Import Policy and subject to the relevant conditions specified in the Annexure to this notification, and referred to in the corresponding entry in column (5) of the said Table, from so much of the duty of excise leviable thereon under section 3 of the Central Excise Act as specified in the corresponding entry in column (4) of the said Table. Table Sr.No. Chapter or heading No. or sub-heading Descripti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the Revenue, SAD must be reckoned for calculating the Central Excise duty because no VAT was being paid while transfer the goods to the DTA unit of the appellant. 7. Demand notices were issued and orders in original dated 24.5.2017 and 25.5.2017 were passed by the lower authorities which were appealed against and they culminated into the issue of impugned order dated 11.05.2018. 8. Learned Counsel for the appellant submits that the short issue to be decided is whether non-payment of VAT by the appellant while stock transfering goods to its own DTA unit should be construed as an exemption from VAT or otherwise. He submits that the issue is no longer res integra it has been decided in the case of Micro Inks Vs. Commissioner of Central Excise Service Tax [ 2014 (303) ELT 99 (Tri.-Ahmd.) ] and further followed in the following decisions: (i) STI Industries Vs. Commissioner of Central Excise, Daman [ 2015 (327) ELT 514 (Tri.-Ahmd.) ]; (ii) Jindal Saw Ltd. Vs. Commissioner of Central Excise, Ahmedabad-I [ 2016 (334) ELT 172 (Tri.Ahmd.) ]; (iii) VVF Ltd. Vs. Commissioner of Central Excise, Belapur [ 2015 (315) ELT 303 (Tri.-Mumbai) ]; (iv) Behr India L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ating authority for more than one reason. Firstly, it is the fact that the inter unit clearance from EOU to DTA are not exempted from payment of sales tax by the State Government by any notification and revenue unable to bring on record any notifications issued by the State Government or otherwise to indicate that inter unit transfers from EOU to DTA are exempted. It is an admitted fact that whenever there is an inter unit transfer, it is not sales transactions and hence the sales tax/CST/VAT may not get attracted does not mean ipso facto, it is an exemption granted by the State Government. In the absence of any notification granting exemption for specified products by the State Government from levy of sales tax on the finished goods cleared from 100% EOU, it would be incorrect to hold that the goods were exempted from sales tax, more so when the appellant has discharged the sales tax on the same products which were cleared to independent buyers. Secondly, we find that the lower authority seems to have been guided by the argument that inter unit clearance are not taxed by the State Government and is to be construed as an exemption granted. This is totally a wrong perception of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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