2000 (10) TMI 621

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....oduction excluding rejects not exceeding 5% for a period of ten years. For the purpose of setting up 100% EOU, the applicants imported capital goods without payment of Customs duty by availing the exemption under Notification No. 13/81-Cus., dated 9-2-1981 during the period 1986 to 1988 and also procured indigenous capital goods and raw materials without payment of Central Excise duty in terms of Notification No. 123/81-C.E., dated 6-6-1981 during 1988 to 1992. Before expiry of the above period of ten years, the Department issued a show cause notice to the applicants. Two corrigenda were issued later. As per these proceedings, the Department proposed to recover customs duty on the imported capital goods and Central Excise duty on the indige....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....Act. The adjudicating authority, apart from confiscating the goods, imposed penalties of Rs. 25 lakhs and Rs. 30 lakhs on the applicants under Rule 173Q of the Central Excise Rules and Section 112 of the Customs Act respectively. Aggrieved by this order of the Commissioner, the applicants have preferred appeal to this Tribunal and have also filed the present application seeking waiver of pre-deposit of the aforesaid duty and penalty amounts and stay of recovery thereof, pending the appeal. 2. We have carefully examined the grounds of the stay application and have heard ld. Consultant Shri J.M. Sharma for the applicants and ld. JDR Shri M.P. Singh for the respondents. 3. Ld. Consultant submitted that the Commissioner of Central E....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....le; and that the original show cause notice was issued within the period of ten years prescribed for fulfilment of export obligations by the EOU. He further contended that, when the said period elapsed, the exemption notifications became inoperative and, consequently, Customs duty and Central Excise duty became leviable on the imported capital goods and indigenously procured goods respectively on expiration of the aforesaid period of ten years. The applicants were therefore bound to pay the duty as demanded and confirmed. Ld. JDR further argued that, even if the goods were still in bonded premises of the Customs, duty was leviable on the same once it was found that exemption under the notifications was not available to such goods. He also o....