2001 (4) TMI 659

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....nder the Advance license scheme and imported raw materials for manufacture of final product and exporting the same. They have imported TDI duty free and utilized the same in the factory for manufacture of the final product, but they had sold the same in the domestic market on payment of duty. The department initiated proceedings against the appellants on the ground that they have violated the provisions of Notification No. 304/97-Cus. by diverting the same in to the domestic market after manufacturing the final product and there has been violation of the provisions of the Notification. It was pointed out to the Commissioner that Customs themselves have referred the matter to the DGFT about their manufacturing and sales in the domestic marke....

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.... that this observation of the learned Commissioner is totally incorrect and uncalled for. He drew our attention to the above judgment of the Tribunal to show that the Tribunal had not laid down any such ratio about the implication of the Dolphin Drugs case having brought to the notice of the DGFT about diversion of the goods in the domestic market. He pointed out that in the present case in fact the department had initially written to the DGFT about this fact and the Commissioner therefore was not justified in his observation and drawing observation against the judgment of the Tribunal contrary to the law laid down and hence the order of the Commissioner is totally bad in law. He submitted that the ratio of Dolphin Drugs case (supra) is bin....