Customs, Excise and Gold Tribunal - Mumbai
Shri Juned Bilal Memon And Ors. vs Commissioner Of Central Excise on 19 January, 2006
Equivalent citations: 2006(106)ECC338, 2006ECR338(TRI.-MUMBAI), 2006(199)ELT92(TRI-MUMBAI)
ORDER Chittaranjan Satapathy, Member (T)
1. Heard both sides at length. The appellant M/s Kay Bee Tex Spin Ltd. is an 100% E.O.U. in which Shri Manoj Omprakash Goel is Director. The appellant E.O.U. has cleared the impugned goods after obtaining permission of the Development Commissioner under para 9.10(b) of the Exim policy, to the other three appellants against E.E.F.C. account. The appellant's claim is that such clearances should be treated at par with export and no duty should be charged. An alternate plea which has been advanced by the appellants is that they are covered under excise exemption Notification No. 125/84-CE dtd.26.5.2004. It is the case of the department that the clearances cannot be equated with physical export nor it can be granted exemption under Notification No. 125/84. The adjudicating Commissioner has confirmed the duty demand of Rs. 3,48,58,280/- and has imposed the following penalties:
1) M/s Kay Bee Tex Spin Ltd. Rs. 50 Lakhs 2) Shri Manoj Omprakash Goel Rs. 20 Lakhs 3) Shri Munaf Haji Basir Delhiwala Rs. 5 Lakhs 4) Shri Asif Ayubbhai Chasmawala Rs. 5 Lakhs 5) Shri Juned Bilal Memon Rs. 5 Lakhs.
2. After considering submissions from both sides and perusal of case records as well as cited case laws, we are of the opinion that clearances of the impugned goods from 100% E.O.U. to the last three appellant's above named has no doubt been made against receipt of foreign exchange, However, such clearances cannot be treated as exports in view of the fact that export has been defined under the relevant statutes to mean physically taking goods out of India. The second contention of the appellants for benefit under Notification No. 125/84 is also not acceptable. We find that the said notification exempts all goods manufactured in a 100% E.O.U. but the proviso to the said notification denies the exemption to such goods if the same are allowed to be sold in India. We have no doubt in our mind that the appellant E.O.U. has to be denied the exemption under the said proviso since the clearances have been made by them in the domestic tariff area after obtaining permission from the Development Commissioner.
3. However, we find that in the following cases, other benches of the Tribunal have taken a decision contrary to our finding as above :
1) Jumbo Bag Ltd. v. C.C.E., Chennai 2005 (184) E.L.T. (Tri.- Chennai)
2) Pooja Tx Prints P. Ltd. and Ors. v. C.C.E., Surat Order No. A/1816 to 1833/WZB/05/C-III dtd. 20.6.2005
3) Gujarat Sico Textiles Pvt. Ltd. v. C.C.E., Surat-II Order No. 418-421/05 dtd, 178.05.2005
4) Maruti Cottex Limited v. C.C.E., Hyderabad-III
4. On the other hand, our view that clearance in the domestic area can not be treated as export is supported by the following two earlier decisions of the Tribunal.
1) Sanju Silk Mills P. Ltd. v. C.C.E. Surat
2) Prena Syntex v. C.C.E., Jaipur
5. Accordingly, we are of the opinion that the issue requires to be referred to the Larger Bench. The Registry is directed to place the matter before the Hon'ble President for the purpose of constituting Larger Bench for the purpose.