The Chennai Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that rebate for DTA Clearance is eligible on ‘similar’ to goods exported and set aside the order of the Commissioner (Appeals).
The appellants are manufacturers of various precision optical instruments and their components, assemblies and sub-assemblies all falling under Chapter 90 of the First Schedule to the CETA, 1985. The appellants effected clearances of their final products for exports as well as Domestic Tariff Area (DTA) sales within India in terms of paragraph 6.8 of the Foreign Trade Policy (FTP) for the year 2009-2014 which was in force from time to time. The respondent confirmed a duty of Rs.4,06,05,026/- under Section 11A of the Central Excise Act, 1944 and the adjudicating authority also imposed a penalty of Rs.40,60,500/- under Rule 25 of the Central Excise Rules, 2002.
The appellant contended that after DTA clearances in terms of para 6.8(a) of Foreign Trade Policy, discharged duties on all clearances excluding eligible exemptions. Further, contended that goods sold by the Appellant in DTA are ‘similar’ to goods exported by the Appellant. It was submitted that the impugned order denying the benefit of Notification No. 23/2003 dated 31.03.2003 on the sole ground that goods sold to DTA are not ‘similar’ to goods exported by the Appellant is incorrect as there was permission granted by the Development Commissioner in this regard under Notification 23/2003-CE has also been accepted in OIO.
The Tribunal observed that the department cannot vaguely allege that the goods are not similar goods when the appellants have been permitted to clear the goods in DTA by the DC. It was observed that the appellant furnished a Chartered Engineer certificate, certifying that the goods are similar and fall within the category of precision optical components which was brushed aside by the Commissioner (Appeals).
The Tribunal held that the Commissioner (Appeals) failed to consider the opinion given by an expert and unless there is some evidence to rebut such opinion and held that exported are similar goods, there is nothing to establish that these goods do not fall under the category of “precision optical components/ instruments/assemblies”.
The Coram consists of Ms Sulekha Beevi C.S., Member (Judicial) and Shri Raju, Member (Technical) set aside the impugned order and allowed the appeals. Shri Raghavan Ramabhadran appeared for the Appellant and Shri Arul C. Durairaj for the Respondent.
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