2018 (8) TMI 1303 - AT - Customs

Tribunal rules in favor of assessee on duty liability and depreciation, rejects revenue's appeal on lack of specificity.

The Tribunal allowed the appeal of the assessee concerning duty liability on capital goods, permitting depreciation until duty payment in line with Board ... EOU - capital goods procured indigenously as well as imported the same for the purpose of installing the same in the EOU - debonding of unit - Held that:- The adjudicating authority in the impugned order has recorded that the capital goods were used from 1995-97. If that be so, we agree with the learned counsel’s submissions that Board Circular No.14/2004 dated 13.02.2004 will be applicable in the case in hand for the relevant period and the depreciation needs to be allowed till the payment of duty. It is an admitted fact that payment of duty has not yet been done - In the case in hand since the duty liability has not been discharged, no demand can be raised on the appellant - decided against Revenue. Demand of duty foregone on the inputs - Held that:- The appeal memoranda of the revenue is not specifying as to what the exact amount that needs to be confirmed from the assessee. In the absence of any such details in the grounds of appeal, we are unable to consider the revenue’s appeal - appeal rejected. Capital goods - Held that:- Since we have decided the assessee’s appeal on merits itself, no demand of duty liability arises on capital goods on which duty liability has not yet been discharged. Nothing survives in the appeal of revenue - appeal of Revenue dismissed. Appeal dismissed - decided against Revenue. Issues:1. Duty liability on capital goods and inputs procured without payment of duty.2. Consideration of Board Circular on depreciation of capital goods.3. Demand of duty foregone on inputs.4. Appeal on capital goods by the revenue.Analysis:1. The case involved the duty liability on capital goods and inputs procured without payment of duty by an EOU. The unit faced market volatility and was de-bonded by DGFT Authorities. The revenue issued a show cause notice demanding duty on the imported and indigenous capital goods and inputs. The Tribunal previously set aside the impugned order and remitted the matter back for fresh consideration. The appellant contested the confirmation of duty liability on capital goods, arguing that depreciation should be allowed until duty payment, as per Board Circular No.14/2004. The Tribunal agreed, citing similar precedents, and allowed the appeal of the assessee.2. Regarding the revenue's appeal on duty foregone on inputs, the adjudicating authority had appropriated an amount towards duty liability on unused inputs. However, the revenue failed to specify the exact amount to be confirmed from the assessee in their appeal memoranda. Due to this lack of detail, the Tribunal rejected the revenue's appeal on inputs.3. As the Tribunal allowed the assessee's appeal on the merits of duty liability on capital goods, no demand arose on capital goods until the duty liability was discharged. Consequently, the revenue's appeal on capital goods was also rejected. All appeals were disposed of accordingly, with the Tribunal providing a detailed analysis and reasoning for each issue raised in the case.