The ceramic colors approved by the exporter for export and the DTA are “ similar ” because the manufacturing activities are the same: CESTAT
The Customs, Excise and Services Tax Appeals Tribunal (CESTAT), Mumbai Bench, while allowing the exemption, ruled that the ceramic colors cleared by the exporter for export and the DTA are “ similar ” because the manufacturing activities are the same.
The appellant, M / s BR Steels Products Pvt Ltd, is an EOU engaged in the manufacture and export of “Ceramic Colors / Pigments, falling under CETA 32071040.
The appellants cleared goods in DTA within the meaning of paragraph 6.8 of the FTP and of the exemption provided for in notification n ° 23/2003-CE of 03.31.2003. Commerce alleged that the items cleared in the DTA by the appellants were not like the exported goods and that there had been a violation of the provisions of paragraph 6.8 of the FTP and that the exemption contained in the notification cited above was therefore wrongly invoked.
The appellants argued that the appellants obtained the necessary permission from the Development Commissioner for export and clearance in DTA, the manufacturing activities are similar for goods exported or cleared in DTA. The only difference between the goods cleared for export is that they are more in the form of concentrate compared to the goods cleared in DTA, therefore, the exported goods are more expensive than the goods released in DTA.
The appellant further argued that the term “like goods” does not mean “identical goods”; it only means to match or resemble in many ways somewhat similar or having a general resemblance and falling in the same class; the term “similar” has a very broad and unrestricted connotation according to the proportion of various judgments; when the development commissioner has made it possible to manufacture and export all types of ceramic colors and the types of ceramic colors can be cleared at the DTA, the central excise service does not have the competence to question accuracy.
The issues raised were whether the ceramic colors authorized by the appellants for export as well as the DTA are similar and whether the benefit of the aforementioned notification can be extended to the challenged goods.
The coram of SK Mohanty and P. Anjani Kumar considered that the words “similar” cannot be limited to mean “identical” or “identical”; instead, when a broader meaning is given to the words “like”, it will encompass products belonging generally to the same class or category.
The Tribunal noted that the department had made no change in the circumstances or in the quality of the goods exported and released in DTA by the appellant.
CESTAT found that the Ministry had wrongly attempted to differentiate the goods on the basis of physical characteristics or the price of the goods.
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