Clearance to SEZ Developers – Amendment Retrospective
AS per Rule 6(6) of the CENVAT Credit Rules, 2004, the provisions of sub-rule (1), (2), (3) and (4) were not applicable in case the excisable goods removed without payment of duty (1) cleared to a unit in SEZ. [Exempted and dutiable goods – obligations]
This was amended by Notification No. 50/2008 – CENT dated 31.12.2008 to stipulate that these provisions will not apply to goods cleared to a unit in SEZ or to a developer of SEZ for their authorized operations. [Developer was added]
So, the confusion about clearances to SEZ developers was sought to be put to an end. But things don't end like that in Revenue. Board by a private letter in F.No.267/52/2008-CX dated 7/1/2009, clarified that the amendment was prospective and would be applicable only from the date of the notification. So, the period prior to 31 st December 2008, was a happy issue for dispute.
In a stay application reported by us in 2009-TIOL-1096-CESTAT-BANG., the Bangalore CESTAT held that the amendment was retrospective. But the Delhi Bench headed by the President did not agree in 2009-TIOL-1567-CESTAT-DEL and referred the matter to a Larger Bench. The Larger Bench headed by the same President held that a reference cannot be made to the Larger Bench based on a stay order and so the Larger Bench returned the matter to the Division Bench. - 2010-TIOL-1841-CESTAT-DEL-LB.
The Division Bench is to hear the case tomorrow.
In the meantime, the Bangalore Bench of the CESTAT delivered its final order in the matter last Monday – 5 September 2011. This Bench confirmed that the amendment was retrospective.
We bring you this order today.
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