2005 (2) TMI 593 - AT - Customs

Commissioner remands case for reevaluation, Tribunal sets aside decision, upholds duty imposition

The Commissioner (Appeals) remanded the matter for de novo adjudication, emphasizing the authority's duty to reconsider the case based on the ... Demand - Customs - Warehoused goods Issues:1. Extension of warehousing period for imported goods.2. Request for re-export of goods and penalty imposition.3. Power of remand by the Commissioner (Appeals).4. Duty liability on warehoused goods and interest.Extension of Warehousing Period:The appellant imported goods and warehoused them under Section 61 of the Customs Act. Due to reasons like slow economy and high obsolescence in technology, they couldn't clear the goods within the extended period. They applied to RBI for permission to re-export the goods at a reduced price. Despite requesting an extension for re-export, the department did not respond promptly. The appellant was later asked to pay a penalty, which they promptly paid. The issue arose when the Dy. Commissioner demanded duty on warehoused goods along with interest, without considering the penalty already paid. The Commissioner (Appeals) remanded the matter for de novo adjudication, emphasizing the authority's duty to reconsider the case based on the circumstances presented.Request for Re-export and Penalty Imposition:The appellant believed their request for re-export was being considered by the department as they promptly paid the penalty demanded. However, the Dy. Commissioner later demanded duty and interest without referencing the penalty payment. The Commissioner (Appeals) upheld the duty and interest imposition, stating that the permission for re-export is not a matter of right and does not extinguish duty liability. The appellant contested this decision, arguing that the confirmation of duty demand without waiting for a decision on the re-export request was improper. They highlighted inconsistencies in the Commissioner's orders and sought a sympathetic consideration due to business challenges.Power of Remand by Commissioner (Appeals):The department appealed to CESTAT, arguing that the Commissioner (Appeals) lacked the power of remand. The Tribunal remanded the matter back to the Commissioner (Appeals) to pass an appropriate order in accordance with the law. The Commissioner (Appeals) subsequently upheld the duty and interest imposition, emphasizing that the duty liability on warehoused goods must be discharged after the extended period, regardless of the re-export request status.Duty Liability on Warehoused Goods and Interest:The Commissioner (Appeals) held that the duty and interest imposition on the warehoused goods was proper and legally correct. The appellant's failure to clear the goods within the specified period led to penal action, as per the Customs Act. The Commissioner (Appeals) rejected the appellant's argument that the duty liability was unfair due to the pending re-export request, citing legal precedents. The Tribunal, however, set aside the Commissioner's decision, emphasizing the department's failure to act on the re-export request before demanding duty and directing a reconsideration by the Original Authority.This detailed analysis of the judgment covers the issues related to the extension of the warehousing period, the request for re-export, penalty imposition, the power of remand by the Commissioner (Appeals), and the duty liability on warehoused goods and interest.