TaxTMI 
TaxTMI 
2005 (3) TMI 697
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....7/19-3-96 Obtained as Transferee. Officers of the DRI had visited the premises of the appellants (hereinafter referred to as GDL), verified the stock of raw material and finished products and conducted enquiries and issued show cause notice dated 28-3-92. The show cause notice required to show as to why: (i) The benefit of exemption Notification No. 203/92-Cus., dated 19-5-92 availed by them in respect of the excess raw materials imported against advance licence No. 3288928 should not be denied and consequently differential duty amounting to Rs. 4,81.403/- should not be demanded in terms of condition (ii) of the said notification; (ii) The benefit of Notifications No. 79/95, 30/97, 31/97 and 51/2000 availed for importing sodium metal should not be denied and consequently customs duty amounting to Rs. 86,81,059/- should not be demanded in terms of the conditions of the aforesaid notification; (iii) The said excess raw materials valued at Rs. 4,91,226/- (AV) should not be held liable to confiscation under Section 111(o) of the Customs Act, 1962. (iv) The imported sodium metal valued at Rs. 1.96,10,668/- (AV....
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....92268 and 1531867, under Section 111(o) of the Customs Act, 1962 was ordered to be confiscated. Since the goods were not available for confiscation, he ordered payment of fine of Rs. 50,00,000/-. (e) Penalty of Rs. 25,00,000/- was also imposed on GDL under Section 112(a) of the Customs Act, 1962. (f) An amount of Rs. 3,16,041/- already paid were to be adjusted against the duty, hence this appeal. 3. After hearing both the sides and considering the material on record, it is found that: (a) A perusal of the show cause notice dated 28-3-92 issued in this case revealed that it alleged as follows: "M/s. GDL imported sodium metal (Annexure 10) against various advance license under DEEC Scheme without payment of customs duty availing the benefit of Notification No. 79/95-Cus., dated 31-3-95, 30/97-Cus., dated 1-4-97, 31/97, dated 1-4-97, and 51/2000-Cus., dated 27-4-97. The goods were imported on prior export basis declaring that they were used in the manufacture and export of SMX/isoxamine under the DEEC Scheme. It is clear from the depositions of....
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....b) makes a declaration before the Assistant Commissioner of Customs, binding himself to pay on demand an amount equal to the duty leviable but for the exemption, on the imported materials in respect of which the conditions specified in this Notification have not been complied with : Provided that a bond or a legal undertaking and the declaration shall not be necessary in respect of imports made after discharge of export obligation in full, as evidenced by endorsement of Licensing Authority in the said certificate. This condition is not demonstrated to be violated. No other violations of the Notification and or EXIM Policy are determined or can be arrived at, in the facts of this case. When no other condition of the Notification is found being violated, duty demands as arrived at and the liability of the goods to confiscation under Section 111(o) of the Customs Act, 1962 as arrived at cannot be upheld in the case of sodium metal in case of those four licenses where the licence holder has transferred the licence after the export obligations have been duly discharged. Therefore the order of imposition of penalty and redemption fine arrived on this account cannot be sustained. ....
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....officers. Instructions exist in this regard that, if the Customs Department is of the opinion that certain import licences have been issued which need not have been issued, they should take up the matter with the DGFT and get the licence cancelled to render them void ab initio. So long as the licences are not so cancelled, full effect to the imports permitted thereon has to be given. No reason has therefore been found to refuse the same, especially when no clauses of the Notifications are found to have been contravened. We are reinforced in this view by the reliance placed by the learned Advocate in the case of A. Shankar Rao reported in 2002 (149) E.L.T. 387 and reject the plea of 'no nexus' made. Nexus is not required to be strictly enforced for imports made or to be determined on the imports on transferred licences. (d) As regards imports made under licence No. 3288928 dated 11-1-94, that licence has been obtained by M/s. GDR. The ld. Counsel for the appellants fairly submits that as regards this particular licence, the quantity permitted to be imported are as follows : Sl. No Item Permitted Import (Kg) Exported Quantity (Kg) 1 Sodium Hydro Sulphate 48....