Rewarehousing and export obligation dispute remitted for fresh consideration after Tribunal order was set aside

In a dispute involving a 100% export-oriented unit that had not fulfilled its export obligation after importing raw materials duty free, the Tribunal had set aside duty, interest and penalty demands on the view that the demand could not stand without an option of re-warehousing or re-exporting the unutilised materials and by extending the bond period. As the assessee had not sought re-warehousing or extension of the bond period, the Tribunal's order was quashed and the matter was remitted for de novo consideration in accordance with law. The merits of the duty, interest and penalty demands were left open.

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Issues: (i) Whether the Tribunal's order setting aside the duty, interest and penalty demands should be quashed and the matter restored for de novo consideration.

Issue (i): Whether the Tribunal's order setting aside the duty, interest and penalty demands should be quashed and the matter restored for de novo consideration.

Analysis: The appeal arose from a 100% EOU which had not fulfilled its export obligation after importing raw materials duty free. The Tribunal had set aside the original adjudication on the view that the demand could not be sustained without granting the option of re-warehousing or re-exporting the unutilised raw materials and had also extended the bond period. It was undisputed that the assessee had neither sought re-warehousing nor sought extension of the bond period. In these circumstances, the parties agreed that the Tribunal's order should not stand and that the matter should go back for fresh consideration in accordance with law.

Conclusion: The Tribunal's order was quashed and set aside and the matter was restored to the Tribunal for de novo consideration.

Final Conclusion: The dispute was sent back to the Tribunal for fresh adjudication, leaving the merits of the duty demand, interest and penalty open.

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