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TMI Blog2025 (5) TMI 454X X X X Extracts X X X X X X X X Extracts X X X X ..... iling benefit of exemption Notification No.52/2003-Cus. dated 31.03.2003 against import and Notification No.22/2003-CE dated 31.03.2003 for indigenously procured materials. The finished goods viz., SPV Modules manufactured utilising the said duty-free raw materials were either exported or cleared into Domestic Tariff Area (DTA). In case of DTA clearance, appellants were paying applicable Customs Duty along with Education Cess, Secondary Higher Education Cess and Special Additional Duty (SAD) excluding Countervailing Duty (CVD). On audit of their records, it was alleged that the final product which was manufactured out of duty-free inputs cleared into Domestic Tariff Area (DTA) without payment of duty, appellants had violated condition of Notification No.22/2003-CE dated 31.03.2003 and Notification No.52/2003-Cus. dated 31.03.2003, not eligible to the benefit of exemption for such clearances and accordingly, show-cause notice was issued for the period from April 2001 to August 2013 on 16.05.2014 demanding customs duty foregone amounting to Rs.9,53,82,016/-, excise duty foregone amounting to Rs.2,04,16,415/- and reversal of proportionate cenvat credit of Rs.53,22,879/-; second show-c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation, it exempts goods used in the manufacture of Solar Cells/Modules from whole of customs duty leviable under First Schedule to the Customs Tariff Act, 1975. Therefore, even if the appellants had imported the goods without availing the exemption under Notification No.52/2003-Cus. dated 31.03.2003, they are entitled to opt for exemption under either of the above Notification. Hence, the duty foregone on such goods should be 'Nil'. 3.2 Assailing impugned order which had denied the benefit under the said Notification No. No.25/1999-Cus. dated 28.02.1999 and Notification No.24/2005-Cus. dated 01.03.2005 solely on the ground that appellant had not satisfied the conditions of Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996, he has submitted that the major conditions prescribed under the said Rule has been fulfilled by the appellant in as much as: (i) The appellant is registered with the Central Excise Officer and the goods manufactured/inputs used are known to the department. (ii) The intimation is given even under the EOU scheme for bonding. (iii) All the particulars are included in the Bond Register. (iv) Being an EOU, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that the exemption Notification must be construed with regard to their purpose and object and if it is considered that the appellant is substantially eligible to claim the exemption, the Notification must be construed liberally. In support, they have referred to the judgment of the Hon'ble Supreme Court in the case of Commissioner of Customs vs. Malwa Industries: 2009 (235) ELT 214 (SC); Lohia Sheet Products vs. Commissioner of Customs: 2008 (224) ELT 349 (SC) and Racily Udyog vs. CCE: 2023-TIOL-357-CESTAT-KOL. They have submitted that once they are entitled to the benefit of Notification No.6/2006-CE dated 01.03.2006 and Notification No.12/2012-CE dated 17.03.2012, the appellant would be automatically eligible to SAD under Notification No.20/2006-Cus. dated 01.03.2006 as amended by Notification No.21/2012-Cus. dated 17.03.2012. Further, they have submitted that confiscation of goods under Section 111(o) of Customs Act, 1962 and penalty under Section 112 are not sustainable in as much as there has been no seizure of goods under Section 110 and the goods have been directly been ordered to be confiscated under Section 111. In support, they have referred to the judgments in the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emption on the said parts from BCD under alternative exemption Notifications No.25/1999-Cus. dated 28.02.1999 and Notification No.24/2005-Cus. dated 01.03.2005; also they claimed benefit of exemption under Notification No.6/2006-CE dated 01.03.2006 and Notification No.12/2012-CE dated 17.03.2012 from additional duty of customs (CVD) and SAD. 7. On the admissibility of benefit of Notification No.06/2006-CE dated 01.03.2006 and Notification No.12/2012-CE dated 17.03.2012, this Tribunal in the case of HHV Solar Technologies (supra) observed as follows: "9. In the present case, the appellant sought exemption on various parts procured locally as well as imported, used in the manufacture of Solar Module (non-conventional energy devices) at Sl. No.11 and 20 of the said List 5 against Sl. No.84 of List 5 of Notification No.6/2006-CE dated 01.03.2006. Sl. No.21 of List 5 allows exemption to parts consumed within the factory of production of such parts for the manufacture of goods specified at Sl. No.1 to 20 of the said List. Thus, it is very clear that the parts which are manufactured within the factory can be allowed when consumed in the manufacture of items mentioned at Sl. No.1 to 20. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uty which within the factory of production of such parts for the manufacture of goods specified at serial numbers 1 to 20 and not parts of water pumping station. It needs to be noted that entry number (10) of List 8 mentions 'solar power generating system' and not 'module mounting structures'. ........... 18. It is, therefore, not possible to accept the contention of learned counsel for the appellant that the module mounting structures' should be granted exemption from payment of excise duty in terms of the notification dated 17.03.2012 and not the 'solar power generating system'. ........... 21. An exemption notification has to be strictly construed, as was observed by the Supreme Court in Commnr. of Customs (import), Mumbai versus M/s. Dilip Kumar and Ors. 2016 (5) TMI 185 - Supreme Court = 2018-TIOL-302-SC-CUS-CBand in Larsen & Toubro Ltd. versus Commissioner of Central Excise, Hyderabad 2015 (324) E.L.T. 646 (S.C.) = 2015-TIOL-236-SC-CX. 22. The distinction sought to be drawn by the learned counsel for the appellant between 'devices' and 'systems' is not of relevance to the present case because both non-conventional energy d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ture and in construing a statute, it is necessary, to seek the intention of its maker. A statute has to be construed according to the intent of them that make it and the duty of the Court is to act upon the true intention of the Legislature. If a statutory provision is open to more than one interpretation the Court has to choose that interpretation which represents the true intention of the Legislature. This task very often raises the difficulties because of various reasons, inasmuch as the words used may not be scientific symbols having any precise or definite meaning and the language may be an imperfect medium to convey one's thought or that the assembly of Legislatures consisting of persons of various shades of opinion purport to convey a meaning which may be obscure. It is impossible even for the most imaginative Legislature to forestall exhaustively situations and circumstances that may emerge after enacting a statute where its application may be called for. Nonetheless, the function of the Courts is only to expound and not to legislate. Legislation in a modern State is actuated with some policy to curb some public evil or to effectuate some public benefit. The legislation is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the legislation. Having observed general principles applicable to statutory interpretation, it is now time to consider rules of interpretation with respect to taxation." Summarising the principles of interpretation, their Lordships observed at para 52 as: "52. To sum up, we answer the reference holding as under - (1) Exemption notification should be interpreted strictly; the burden of proving applicability would be on the assessee to show that his case comes within the parameters of the exemption clause or exemption notification. (2) When there is ambiguity in exemption notification which is subject to strict interpretation, the benefit of such ambiguity cannot be claimed by the subject/assessee and it must be interpreted in favour of the revenue. (3) The ratio in Sun Export case (supra) is not correct and all the decisions which took similar view as in Sun Export case (supra) stands overruled." 13. Following the consistent view of this Tribunal and also the principle laid down by the Hon'ble Supreme Court in the case of M/s. Dilip Kumar and Co. (supra), the claim of the appellant that benefit of Notification No.6/2006-CE dated 01.03.2006 and No.12/2012-CE dated 17 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the EOU and non-EOU executes a bond covering the duty on the imported goods. In both cases, the EOU as well as the non-EOU maintain a proper account of the goods imported, its utilization and balance in stock is maintained which is subject to verification by the Customs authorities or the Central Excise officer respectively. Further, in the case of bath EOU and non-EOU, monthly returns are filed with the Central Excise Officer. Therefore, it is evident, from the above that procedures followed by the EOU assessees are similar to the procedures followed by Non-EOUs under the Customs (IGCRDMEG) Rules. In the instant case, there is no allegation that the assessees had failed to comply with any of the procedural requirements required for the duty free imports by the EOU, Further, I also find that there is no dispute that the duty free imported goods had been received and used in the manufacture of Solar modules. Therefore when substantial compliance to the essence of the. conditions of the Customs (IGCRDMEG) Rules have been complied with, I hold that the assessees are eligible for the benefit of the exemption notification No 25/99-Cus dated 28-02-1999 and No 24/2005-Cus dated 01-03-20 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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