2024 (9) TMI 1038 - AT - Customs

Appellant liable for 4% SAD but extended period demand rejected due to no suppression of facts

M/s. M.S. Clothing Company Versus Commissioner of Customs., Bangalore

CESTAT Bangalore upheld appellant's liability to pay 4% SAD under amended provisions but rejected extended period invocation due to absence of suppression ... Benefit of N/N.20/2006 dated 01.03.2006 (Sl.No.50) and Notification No.21/2012-Cus. (Sl. No. 12) dated 17.03.2012 - liability to pay SAD of 4% in view of the amendment dated 08.04.2011 brought in the First Schedule to Additional Duties of Excise (Goods of Special Importance) Act, 1957 - suppression of facts or not - invocation of the extended period of limitation - HELD THAT:- In similar set of facts and circumstances, this Bench in the case of M/S. SEWING SYSTEMS PVT. LTD. VERSUS THE COMMISSIONER OF CUSTOMS, BANGALORE [2024 (8) TMI 676 - CESTAT BANGALORE], held 'this Court, through a catena of decisions, has held that the proviso to Section 28 of the Act finds application only when specific enumerated in the proviso to the said sub-section are more than one and if the Excise Department places reliance on the proviso it must be specifically stated in the show-cause notice which is the allegation against the assessee falling within the four corners of the said proviso.' - the appellant is liable to pay 4% SAD, thus the impugned order is upheld on merit. Suppression of facts or not - HELD THAT:- Since, the description, specific chapter heading and respective duties liable to be paid are clearly mentioned and assessed to duty by the officers, the question of reopening the assessments for the past period does not arise. There are no material facts that have been mis-declared or misrepresented except to state that in self-assessment, the appellant should have been vigilant and claimed only those benefits that were available to them. In view of the above, there are no reason to uphold the demand beyond the normal period. It is also noticed from the records that that the appellant has paid the entire duty amount of Rs.3,95,676/- for the normal period from February 2012 to October 2012. Thus, by following the decision of this Bench in the case of Sewing Systems Pvt. Ltd, the demand along with interest is confirmed for the normal period. Confiscation of the goods under Section 111(m) along with penalty imposed under Section 114A of the Customs Act, 1962 is set aside. Appeal allowed in part. Issues:1. Eligibility for the benefit of specific notifications.2. Misdeclaration leading to the invocation of the extended period of limitation.Analysis:1. The first issue revolves around the appellant's eligibility for the benefit of Notification No.20/2006 and Notification No.21/2012. The appellant imported goods under these notifications but later found out that the goods were omitted from the First Schedule, making them liable to pay additional duty of customs. The Tribunal held that the appellant was not eligible for the benefit of the notifications due to the specific goods being omitted from the First Schedule, as per the decision in a similar case. The Tribunal emphasized that exemption notifications must be strictly interpreted, and the appellant was deemed ineligible for the benefit during the disputed period.2. The second issue concerns the misdeclaration leading to the invocation of the extended period of limitation. The appellant disputed any misdeclaration, stating that the Bills of Entry clearly mentioned the relevant exemption notifications. The Tribunal noted that the appellant had filed Ex-bond Bills of Entry, clearly showing the goods' description and duties, which were assessed and allowed by customs officers. The Tribunal cited a Supreme Court case emphasizing the distinction between inadvertent non-payment and deliberate default, stating that the burden of proving willful default lies with the Revenue. As there were no specific averments in the show-cause notice and no evidence of willful default on the appellant's part, the extended period of limitation could not be invoked. The Tribunal upheld the demand for 4% SAD for the normal period but set aside the demand beyond the normal period due to lack of evidence of willful misdeclaration.3. The Tribunal confirmed the demand for the normal period and set aside the confiscation of goods and penalty imposed under the Customs Act, following a previous decision. The appellant had paid the entire duty amount for the normal period, leading to the modification of the impugned order and partial allowance of the appeal.