The Chennai bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) held that the National Calamity Contingent Duty (NCCD) cannot be levied on the clearance of excisable goods to 100% Export Oriented Units (EOU) for captive consumption.
Komatsu India Pvt. Ltd, the appellant assessee was engaged in the manufacture of ‘Dumpers’ and in terms of Section 136 of the Finance Act, 2001 amended, a surcharge by way of duty of excise called as National Calamity Contingent Duty (NCCD) was levied on the goods specified in the 7th schedule of the Finance Act at the rate specified therein and had to be collected as the duty of excise.
The assessee appealed against the order passed by the adjudicating authority for confirming the NCCD demand along with the interest and penalty against the assessee.
G. Natarajan, the counsel for the assessee contended that the levy of NCCD had been introduced vide Section 136 of the Finance Act for the goods mentioned in the Seventh Schedule to the Act. As per the said section, NCCD shall be levied and collected as the duty of excise.
Also submitted that the NCCD was not leviable concerning clearances for captive consumption.
Rudra Pratap Singh, the counsel for the department relied on the decisions made by the lower authorities and contended that the assessee was liable to pay the NCCD and the demand raised by the revenue was as per the law and liable to be sustained.
The Bench observed that in the case of Modern Petrofills Vs CCE, the court held that the NCCD was not leviable concerning the clearance of excisable goods for captive consumption.
The two-member bench comprising Sulekha Beevi (Judicial) and Vasa Seshagiri Rao (Technical) held that the NCCD was not leviable in respect of goods cleared availing the benefit of Notification No.108/95-CE while allowing the appeal filed by the assessee.
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