Authority for Advance Ruling for Customs, Central Excise & Service tax clarifies..
There have been doubts expressed and in some cases, notice have also been issued by the authorities to deny the exemption under Not 45/2005 to stock transfers from an SEZ unit to a DTA unit of the same manufacturer.
This very question has been considered by the Authority for Advance Ruling for Customs, Central Excise & Service tax in GE India Industrial P Ltd. The Authority for Advance Ruling has held that the exemption would be available and provided a reasoning for this in an application made by GE India Industrial Private Limited.
Relevant portion of the ruling reads as under :
"The position is crystal clear that Notification No. 45/2005 Cus exempts all goods cleared from the SEZ and brought to any of the place in India from the SAD levied thereon under Section 3(5) of the Tariff Act.
However when such goods are sold in domestic tariff area and are exempted by the State Government from the payment of sales-tax or VAT such exemption is not available."
Though this is a ruling made to a specific question raised by GE India there is good reasoning provided for the conclusion which can have great force when representing any other case as well on the same issue.