CESTAT grants stay waiving Rs.78,53,643 duty & penalty for re-export of LCD panels.

The Appellate Tribunal CESTAT New Delhi granted the appellant's stay petition, waiving the pre-deposit of duty and penalty amounting to Rs.78,53,643 imposed for the re-export of LCD panels classified under a different heading than initially imported. The Tribunal ruled in favor of the appellant, emphasizing the genuine intention to use the panels for manufacturing LCD televisions, despite their re-export without use. The decision highlighted the appellant's eligibility for concessional duty based on intended use, not actual use, and referenced relevant legal precedents and rules supporting the appellant's position. The stay petition was unconditionally allowed on 02.07.2013.

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Issues:
Claim for dispensing with pre-deposit of duty and penalty in a stay petition regarding the classification and re-export of LCD panels.

Analysis:
The Appellate Tribunal CESTAT New Delhi addressed a stay petition seeking to waive the pre-deposit of duty and penalty amounting to Rs.78,53,643/- imposed on the appellant, engaged in manufacturing LCD Televisions. The appellant imported LCD panels classified under heading 9013 for nil basic customs duty, but Revenue classified them under heading 8529 attracting a 10% duty rate. The appellant availed benefits under notification No. 21/2002-Cus for manufacturing LCD televisions, clearing goods at a 5% duty rate. Dispute arose when some panels were re-exported without use, leading Revenue to demand differential duty, initiating proceedings against the appellant.

The appellant argued that the intended use, not actual use, of imported goods for manufacturing should determine concessional duty eligibility, citing a Supreme Court decision. The Tribunal agreed, emphasizing the appellant's genuine intention to use the panels for manufacturing, even though they were re-exported unused. The Tribunal noted the introduction of Rule 7A allowing re-export of unutilized goods and highlighted a previous Tribunal ruling classifying LCD panels under heading 9013, despite an appeal pending before the Supreme Court.

Considering the appellant's prima facie case, the Tribunal found in favor of the appellant, allowing the stay petition unconditionally. The Tribunal's decision was pronounced on 02.07.2013.

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