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68 EXCISE LAW TIMES [ Vol. 372

ty deserves to be quashed and set aside. It was pointed out that insofar as the
units engaged in generating electricity in DTA are concerned, they are not at all
liable to pay excise duty under the Central Excise Act, 1944, inasmuch as, “elec-
tricity” has been held to be non-excisable goods since against the Excise Tariff
Heading No. 2716 00 00, no duty is indicated. It was submitted that thus, such
domestic units would be even otherwise at an advantageous position as com-
pared to SEZ units in the event of there being any liability on the part of the SEZ
unit to pay customs duty on removal of electricity from SEZ to DTA.
5.7 It was submitted that one of the main objectives of the Government
of India behind the enactment of the SEZ Act, 2005 is to make available goods
and services free of tax and duties supported by integrated infrastructure for ex-
port production, expeditious and single window approval mechanism and a
package of incentives to attract foreign and domestic investments for promoting
export-led growth. It was submitted that in order to place the SEZ Act at a higher
pedestal as compared to the Customs Act, the same has been given an overriding
effect under Section 51 of the SEZ Act.
5.8 It was submitted that Section 12 of the Customs Act is a charging
section, which provides for “Levy of Customs duty on goods imported into
and/or exported from India”, which means, the goods which are brought from a
territory outside India into India and/or taken out from India to a territory out-
side India would only be taxable under the Customs Act. In the absence of any
amendment of the definitions of “export”, “import” and “India”, that is in Sec-
tions 2(18), 2(23) and 2(27) of the Customs Act respectively, or any amendment in
the charging section viz. Section 12 of the Customs Act or insertion of a charging
provisions under the Customs Act, contemplating movement of goods from the
DTA to SEZ and/or SEZ to DTA as a taxable event entailing a levy of Customs
duties, the levy of Customs duty under the Customs Act would not be justified
with reference to removal/transfer of goods from SEZ to DTA or from DTA to
SEZ. Reference was made to the decision of this Court in the case of Essar Steel
Limited v. Union of India, 2010 (249) E.L.T. 3 (Guj.), wherein this Court while deal-
ing a situation with respect to export duty on goods supplied from DTA to SEZ,
observed as under :
“39. Having heard the Learned Counsel appearing for the parties and
having gone through their rival submissions as well as pleadings in the
light of the statutory provisions and decided case law on the subjects, we
are of the view that the moot question for our consideration is as to whether
the levy of export duty on goods supplied from the Domestic Tariff Area to
the Special Economic Zone is justified under law. …..”
“41.1.2 The various terms used in Section 12 of the said Act, which is the
charging section for the purpose of levy of duty, have been defined under
the said Act itself. Section 2(18) defines export to mean taking out of India
to a place outside India; Section 2(19) defines export goods as goods which
are to be taken out of India to a place outside India; Section 2(27) defines
India as including the territorial waters of India. Therefore, the taxable
event contemplated under the Customs Act, 1962 for the purpose of levy of
export duty is taking the goods out of the territorial waters of India to a
place outside India, in which case the goods would be dutiable goods as
contemplated under Section 12 of the said Act and attract levy of export du-
ty, to be paid at the time of exportation of such goods. Export under the
Customs Act, 1962, therefore, can be said to have taken place only upon

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