2019 (6) TMI 28 - AT - Customs

Tribunal upholds appellants' claim for concessional duty rate in cement import dispute.

M/s. Rehoboth Exports and Imports, M/s. R.C. Impex Versus Commissioner of Custom House, Tuticorin

The Tribunal ruled in favor of the appellants in a case involving the import of cement from Pakistan claiming a concessional rate of countervailing duty ... Benefit of Concessional rate of CVD - N/N. 4/2006-CE dt.1.3.2006 - sale of imported Cement to retail consumers at a higher price or not - time limitation - HELD THAT:- The issue has been decided in various cases where it was held in favor of importers - reliance placed in the case of M/S. ANTONY METALS, M/S. VINCENT & SONS, M/S. KENSTAR EXIMS, M/S. AATHEES HARD FLOORING, M/S. TRIUMPH ENTERPRISES & INVESTMENTS MADURAI (P) LTD., M/S. P.S.S. JAYAM & CO., M/S. PRP EXPORTS, M/S. S. JAWAHARLAL AND CO., M/S. AL KABIR IMPEX SERVICES AND M/S. MADHUCON PROJECTS LTD. VERSUS C.C., TUTICORIN [2019 (2) TMI 1258 - CESTAT CHENNAI] where it was held in favor of importers on the ground of limitation. Also in the case the case of M/s. Diamond Cement Vs. Commissioner of Central Excise, Bhopal [2017 (1) TMI 1476 - CESTAT NEW DELHI] was relied upon where on the matter of eligibility to concessional rate under serial number 1C of Notification No. 04/2007-CE. has held that the sale to the individual without any intermediary person is entitled for concessional rate of duty. The demand, interest or the penalty cannot survive both on merits as well as on limitation - Appeal allowed - decided in favor of appellant. Issues Involved:Import of cement from Pakistan claiming concessional rate of countervailing duty (CVD) under Notification No.4/2006-CE, denial of benefits by the department, imposition of penalties, invocation of extended period of limitation, self-assessment of Customs Duty, eligibility for concessional rate under different clauses of the notification.Analysis:1. Import of Cement and Claim for Concessional CVD Rate:The appellants imported cement from Pakistan and availed concessional rate of CVD under Notification No.4/2006-CE. The department alleged that the imported cement could be sold in the retail market, thus denying the benefits claimed under the notification. Show Cause Notices (SCNs) were issued proposing to deny the benefits, demand enhanced duty, interest, and impose fines. The original authority confirmed the demand and penalties, which were upheld by the Commissioner (Appeals). The appellants argued that there was no evidence to prove that the imported cement was sold to retail consumers at a higher price.2. Invocation of Extended Period of Limitation:The department issued SCNs more than one or two years after the disputed imports, seeking recovery under Section 28 of the Customs Act, 1962 for a period of five years. However, the Tribunal found that the department failed to provide cogent evidence to support the allegations of selling imported cement at higher rates. The proceedings were deemed to be hit by limitation as the department could not establish suppression or misstatement of facts with incontrovertible evidence.3. Self-Assessment of Customs Duty and Eligibility for Concessional Rate:The Tribunal noted that self-assessment of Customs Duty by importers came into effect with the Finance Act, 2011. The appellants claimed fulfilment of actual user conditions for concessional duty on imported cement. The Tribunal emphasized that the assessing officer should have verified the actual user condition post-importation and that denial of exemption could only occur upon evidence of misuse. As the department failed to provide such evidence, the eligibility for CVD concession could not be questioned later without substantial proof.4. Judicial Precedents and Applicability of Previous Decisions:The Tribunal referred to previous cases where similar issues were addressed, emphasizing that the department's allegations lacked concrete evidence. The decisions in those cases were found to be applicable to the present appeals, leading to the conclusion that the demands, interest, and penalties could not be sustained on both merit and limitation grounds. The impugned orders were set aside, and the appeals were allowed with consequential benefits as per law.In conclusion, the Tribunal ruled in favor of the appellants, dismissing the department's claims due to lack of evidence and limitations on the proceedings. The judgments in previous cases were cited to support the decision, emphasizing the importance of substantiated evidence in such matters.