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2020 ] COMMR. OF C. EX., NAGPUR v. UNIVERSAL FERRO & ALLIED CHEMICALS LTD. 25
Act, 1962 and that under Section 5A of the Central Excise Act, 1944, the Central
Government has no power to grant exemption from payment of duty to an EOU.
41. To consider the submission, it will be relevant to refer to the rele-
vant part of Sections 3 and 5A of the Central Excise Act, 1944, which read thus :
“3. Duty specified in the Fourth Schedule to be levied. - (1) There shall
be levied and collected in such manner as may be prescribed a duty of ex-
cise to be called the Central Value Added Tax (CENVAT) on all excisable
goods (excluding goods produced or manufactured in special economic
zones) which are produced or manufactured in India as, and at the rates, set
forth in the Fourth Schedule :
Provided that the duty of excise which shall be levied and collected on any
excisable goods which are produced or manufactured by a hundred per
cent export-oriented undertaking and brought to any other place in India,
shall be an amount equal to the aggregate of the duties of customs which
would be leviable under the Customs Act, 1962 (52 of 1962) or any other
law for the time being in force, on like goods produced or manufactured
outside India if imported into India, and where the said duties of customs
are chargeable by reference to their value, the value of such excisable goods
shall, notwithstanding anything contained in any other provision of this
Act, be determined in accordance with the provisions of the Customs Act,
1962 and the Customs Tariff Act, 1975 (51 of 1975).”
***
5A. Power to grant exemption from duty to excise. - (1) If the Central
Government is satisfied that it is necessary in the public interest so to do, it
may, by notification in the Official Gazette, exempt generally either abso-
lutely or subject to such conditions (to be fulfilled before or after removal)
as may be specified in the notification, excisable goods of any specified de-
scription from the whole or any part of the duty of excise leviable thereon :
Provided that, unless specifically provided in such notification, no exemp-
tion therein shall apply to excisable goods which are produced or manufac-
tured -
(i) In a free trade zone or a special economic zone and brought to any
other place in India; or
(ii) by a hundred per cent export-oriented undertaking and brought to
any other place in India.
Explanation. - In this proviso, “free trade zone”, “special economic Zone”
and “hundred per cent export-oriented undertaking” shall have the same
meanings as in Explanation 2 to sub-section (1) of Section 3.”
42. A perusal of sub-section (1) of Section 3 of the Act would show, that
Sub-section (1) of Section 3 provides for levy and collection of duty of excise in
such manner as may be prescribed to be called the Central Value Added Tax
(CENVAT) on all excisable goods, which are produced or manufactured in India
as, and at the rates, set forth in the Fourth Schedule. However, the said sub-
section (1) of Section 3 excludes the applicability thereof, to the goods produced
or manufactured in special economic zones. The proviso to sub-section (1) of Sec-
tion 3 of the Act is applicable to the excisable goods, which are produced or
manufactured by a 100% export-oriented undertaking when such goods are
brought to any other place in India. It provides, that in such a case, an amount
equal to the aggregate of the duties of Customs which would be leviable under
the Customs Act, 1962 or any other law for the time being in force, on like goods
EXCISE LAW TIMES  1st April 2020  187