Tribunal Upholds Duty Demand on EOU for Export Obligation Non-Fulfillment

The Tribunal upheld the demand for customs duty and central excise duty from a 100% Export Oriented Unit (EOU) under the STPI Scheme for non-fulfillment of export obligation. The appellant's request for adjournments based on a pending review petition was denied as the petition had been rejected. Despite partial fulfillment of export obligation, the Tribunal imposed duty demand with interest and a nominal penalty of Rs. 17,000. The appellant was directed to deposit the entire liability within twelve weeks to comply with the Customs Act, with a deadline set for 18.08.2014, warning of appeal rejection for non-compliance.

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Issues involved:
1. Customs duty and central excise duty demanded from a 100% EOU under STPI Scheme for non-fulfillment of export obligation.

Detailed analysis:
The judgment revolves around the issue of customs duty and central excise duty demanded from a 100% Export Oriented Unit (EOU) under the Software Technology Parks of India (STPI) Scheme due to the non-fulfillment of export obligation. The appellant had requested adjournments citing a pending review petition against the Director (STPI) order. However, during the recent hearing, it was revealed that the review petition had been rejected. The appellant argued that they had partially fulfilled the export obligation beyond the prescribed period but the Director, STPI had refused to grant an extension, imposing a nominal penalty for non-fulfillment. The Tribunal noted that the appellants had indeed failed to fulfill the export obligation, justifying the duty demand with interest. A penalty of Rs. 17,000 was also imposed, considered nominal by the Tribunal.

The Tribunal analyzed the facts and circumstances, concluding that the appellant had not been able to establish a prima facie case in their favor. Consequently, the appellant was directed to deposit the entire liability and adjudged dues within twelve weeks to fulfill the obligation as per the provisions of Section 129E of the Customs Act 1962. The deadline for compliance was set for 18.08.2014. The Tribunal explicitly stated that failure to make the deposits as directed would result in the appeal being rejected without any further opportunity for the appellant to present their case. The operative portion of the order was pronounced in open court, emphasizing the seriousness of the compliance requirement.

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