2009 (3) TMI 151 - AT - Customs

Tribunal remands appeal for fair decision, emphasizes natural justice principles. Commissioner to consider rectification and re-exportation.

The Tribunal allowed the appeal by remanding the case for a fresh decision, emphasizing the need for a fair opportunity for the appellant to present ... 100% EOU – Re-import of exported consignment - a 100% EOU exported a consignment and which has to be re-imported as there was some technical problems in the consignment and the same have been rectified and exported though not within six months, normal period stipulated for such re-export. At the time of re-importation, a bond was executed with bank guarantee undertaking to export within six months. The Assistant Commissioner vide order dated 24-3-08 encashed the bank guarantee and thereafter Commissioner passed the impugned order dated 7-4-2008 confirmed the demand of duty amounting to Rs. 24,20,000/- without even issue of show-cause notice and without offering personal hearing – held that – matter is remanded for fresh consideration. Issues: Appeal against demand of duty without show-cause notice or personal hearing, re-importation of consignment by a 100% EOU, non-satisfaction of notification condition, bank guarantee encashment, time limit for re-export, remand for fresh decision by Commissioner after granting hearing opportunity.Analysis:1. The appellant, a 100% Export Oriented Unit (EOU), exported a consignment that needed to be re-imported due to technical problems, even though not within the stipulated six-month period. The Assistant Commissioner encashed the bank guarantee upon re-importation, and the Commissioner confirmed a duty demand of Rs. 24,20,000 without issuing a show-cause notice or offering a personal hearing.2. The Advocate argued that the Commissioner should have considered the rectification and re-exportation of the goods before confirming the duty demand. It was acknowledged that the six-month time limit for re-export is not rigid. The Tribunal found merit in the Advocate's submission and set aside the Commissioner's order, remanding the matter for a fresh decision with a reasonable opportunity for hearing.3. The Departmental Representative contended that the re-importation did not satisfy the notification condition, and in such cases, a show-cause notice may not be required. However, the Tribunal emphasized the importance of considering all relevant factors before confirming a duty demand, especially when the goods have been rectified and re-exported.4. The Tribunal's decision to remand the case to the Commissioner for a fresh decision was based on the need for a fair opportunity for the appellant to present evidence and arguments. The Commissioner was directed to decide the issue within 45 days of receiving the evidence from the appellant, ensuring a reasonable opportunity for a hearing.5. Ultimately, the appeal was allowed by remanding the case for a fresh decision, and a miscellaneous application was also disposed of. The Tribunal's order aimed to uphold principles of natural justice and fairness in adjudicating the duty demand issue related to the re-importation of the consignment by the EOU.