DTA Clearances from EOUs - Matter goes to Larger Bench
- 15.03.2010 observed, “FOR setting up an EOU in India, you need two things. One is LOP from the Development Commissioner and the other is a Master's in Mathematics from a reputed University. The former is required for carrying the operations as EOU and the latter for computing the duties payable on DTA clearances and the CENVAT Credit against such clearances”
The Legal Battle
In the Sarla Polyesters case 2008-TIOL-985-CESTAT-AHM, the CESTAT held that the third time cess is payable.
The High Court () set aside the CESTAT order and remanded the matter to the Tribunal.
On remand, as per the directions of the Bombay High Court, Tribunal served notice to the general public so that all the parties who are interested may also apply as interveners. After hearing the appellants, the interveners and the departmental representative, the CESTAT held, “What is required for the purpose of proviso to Section 3 of Central Excise Act, 1944 is to arrive at aggregate of customs duties and once we take a view that education cess is part of the customs duty and is an enhancement, the question of adding it again does not arise. (2010-TIOL-408-CESTAT-AHM)
The Delhi Bench of the Tribunal headed by the then President did not agree and referred the matter to a Larger Bench. Litigation continues!
We will bring you that case tomorrow.