TaxTMI 
TaxTMI 
2007 (1) TMI 336
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....id purpose were entitled to procure duty free materials indigenously by import on the strength of CT-3 certificate. They were availing the benefit of Notification No. 53/97-Cus. for the purpose of procuring indigenously manufactured goods under CT-3 certificate issued by the Jurisdictional Officer. However, on investigation, it was found that the goods procured under CT-3 certificate were never received in factory premises and were disposed of in the market or only paper transaction was done without movement of the goods. In order to fulfill the export obligation some substandard material was obtained from the open market which was subsequently exported in the place of superior quality goods. The present case involves 65,000 pcs of polyeste....
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.... of the seized goods, he is definitely a person having license and registration issued under Rule 58 and Rule 65 of the Customs Act, and therefore, he is deemed to be registered warehouse holder any by not accounting for the duty paid goods bought from the market in the statutory records which has been admitted by the partners, they have definitely violated the provisions of sub-rule (b)(i) of Rule 25. All EOUs are issued LOP by the Development Commissioner in which the description of raw materials to be used for the manufacture of final products are specified and under the LOP, the 100% EOUs are not authorised to bring outside duty paid goods nor the same is permitted under the warehousing and a manufacturer licence issued under the provis....
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....fore the goods cannot be confiscated as held by the Supreme Court in the case of Amrit Foods -2006 (72) RLT 9 (S.C.) which was followed by the Tribunal in the case of Parag Fan & Cooling Systems Ltd. v. CCE, Indore, 2006 (76) RLT 319 (CESTAT-Del.) 5. I have considered the submissions. For better appreciation of the facts and law the provisions of Rule 25 are reproduced below :- "Rule 25. Confiscation and penalty. - (1) Subject to the provisions of section 11AC of the Act if any producer, manufacturer, registered person of a warehouse or a registered dealer, - (a) removes any excisable goods in contravention of any of the provisions of these rules or the notification issued under these rules; or (b) does not accoun....
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....on from duty has been availed is not required to be accounted for under any of the Rules of Central Excise or the Notification issued under Rule 9 for the purpose of warehousing. Further, since these goods were still lying in the factory premises for which no shipping bill was filed it cannot be confiscated under the provisions of the Customs Act for misdeclaration of value and description even if the provisions of Customs Act have not been invoked in the show cause notice. Both the show cause notices and the order of the original authority suffers from infirmity inasmuch as the particular clause of Rule 25 under which the goods are proposed to be confiscated has not been indicated. On the other hand, both the Additional Commissioner as wel....