Tribunal modifies order on duty demand, aligns with High Court directives.

The Tribunal allowed the appeals, modifying the previous order to reflect the Ministry's fixed wastage norms and determining that the demand for duty was premature. The decision was made in the interest of justice, aligning with the High Court's directives.

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Issues:
1. Whether duty is recoverable due to excess wastage of raw materials by the Appellant.
2. Whether the demand for duty is premature.

Analysis:

Issue 1: Duty on Excess Wastage
The Appellants, a recognized 100% Export Oriented Unit, imported rough ophthalmic lenses blanks duty-free for manufacturing ophthalmic lenses. The Revenue alleged that the breakage, wastage, and scrap generated exceeded the permissible 9.09% as per the Input-Output norms. The Tribunal initially confirmed the duty recovery for impermissible wastage but set aside the penalty. The High Court remanded the matter back to the Tribunal to consider the Ministry's decision fixing the wastage norm at 15% retrospectively. The Appellants argued that the Ministry's decision should apply, and no demand is sustainable. The Tribunal, considering the Ministry's norms, held that the Revenue must adhere to the fixed norms, benefiting the Appellants. The impugned orders were found unsustainable, and the Tribunal amended its previous order accordingly.

Issue 2: Premature Demand for Duty
The Appellants contended that duty demand can only be made upon closure of the bonding period or debonding, citing legal precedents. The Tribunal acknowledged the legal correctness of this submission, noting that it was not considered in the previous order. Therefore, the Tribunal held that the demand for duty was premature. Referring to the Bombay High Court's decision, the Tribunal emphasized the inherent power to do justice, setting aside technicalities in favor of merit. In line with the High Court's direction, the Tribunal allowed the appeals filed by the Appellants, granting consequential relief.

In conclusion, the Tribunal allowed the appeals, modifying the previous order to reflect the Ministry's fixed wastage norms and determining that the demand for duty was premature. The decision was made in the interest of justice, aligning with the High Court's directives.

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