TaxTMI 
TaxTMI 
TaxTMI 
2007 (3) TMI 577
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....gapore and cleared through Customs House, Tuticorin, under two Bills of Entry. The goods were imported by M/s. E.T.K.. Softech (P) Ltd., Ranipet and M/s. O.RJ. Electronic Oxides Ltd., Pudukottai, being 100% Export-Oriented Undertakings (EOUs). Bill of Entry No. 109 dated 5-11-98 was filed jointly by M/s. Sundaram Finance Ltd. (SFL, for short) and M/s. E.T.K. Softech (P) Ltd. (ETKSL, for short), for clearance of capital goods which were declared to have been imported from M/s. International Product and Technology Inc., USA (IPTE, for short) and to be capable of manufacturing Iron Oxide (Electronic Grade), with a production capacity of 5000 MTs per annum. The goods were imported, under the EOU scheme, on the strength of permission given by the Development Commissioner, MEPZ, Chennai. They were one Venturi Scrubber, one Wet Oxidation Equipment (Absorber) and 24 Solar Modules (Concentrating Solar Collectors) totally valued at US $ 7,164,993 [C&F] as per Invoice No. 379P dated 25-9-98 and were cleared to bonded warehouse without payment of duty under Notification No. 53/97-Cus. dated 3-6-97 (as amended). The value of the goods had been paid to the suppliers on behalf of M/s. ETKSL by th....
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....able of producing 'Electronic Grade Iron Oxide' and that the design of the equipments was not in conformity with the specifications furnished by the importers. Investigations further disclosed that it was Shri N.M. Parthasarathy who issued a bogus certificate of origin as though the imported goods were of US origin. Apart from being the Managing Director of ETKIF, Shri N.M. Parthasarathy was the Vice-President of the ETKIF America Inc. [a joint venture company of ETKIF and IPTE] as well as Proprietor of 'ETK Export Consultant' Investigations revealed that Shri Parthasarathy had conceived and executed the whole deal by misusing the EOU Scheme for the purpose of claiming undue benefit of drawback of duty on the goods exported by M/s. ETKIF, acquiring foreign exchange in the name of M/s. ETK Export Consultant etc. M/s. SFL and Bank of Madurai Ltd. were found to gain 100% depreciation under the Income Tax Rules. M/s. ETKSL and M/s. ORJ were found to have prior knowledge about the manufacture of goods at ETKIF, Ranipet and to have suppressed this fact while filing the Bills of Entry along with the false certificate of origin issued by N.M. Parthasarathy. They were also found to have mis....
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.... misdeclaration recorded by the adjudicating authority against the importers and the denial of the benefit of the relevant notifications to them are prima facie sustainable. Having found that the same goods as exported to Singapore by M/s. ETKIF were imported by M/s. ORJ and M/s. ETKSL, learned Commissioner noted that the import price had been inflated vis-a-vis the export price of the goods and on this basis overinvoicing was also found against the importers. We have not found any prima facie case for M/s. ORJ against these findings of the Commissioner. Apparently, they have a bad case on the ground of limitation as well inasmuch as the pre-requisites for invoking the extended period of limitation under the first proviso to Section 28(1) of the Customs Act have been established against them. M/s. ORJ have not claimed that they were otherwise eligible for exemption from payment of duty on the subject goods. The other importer viz. M/s. ETKSL is not before us, though their lessor viz. M/s. SFL are in appeal before us. Learned counsel for M/s. SFL has made an endeavour to make a case for exemption from payment of duty on the goods imported by M/s. ETKSL and M/s. ORJ, by submitting th....
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....onic Oxides Ltd. Bill of Entry No. 109 dated 5-11-1998 shows the name and address of the importer as "M/s. Sundaram Finance Ltd. A/c M/s. ETK Softech (P) Ltd." and this bill was signed by representatives of both M/s. SFL and M/s. ETKSL. On the basis of the terms and conditions of the agreement between M/s. Bank of Madurai Ltd. and M/s. ORJ, learned Commissioner took the view that the bank qua lessor held a property in the goods imported by M/s. ORJ and therefore they along with M/s. ORJ could be considered to be importers of the goods. Similar view was taken in respect of M/s. SFL (lessor) and M/s. ETKSL (lessee) on the basis of the terms and conditions of the agreement between them. In both cases, the manner in which the importers' names were mentioned in the relevant Bills of Entry was also noticed by the Commissioner and taken into account for holding that the lessor and lessee in each case were co-importers of the subject goods. Learned counsel for the bank and M/s. SFL referred to the definition of 'importer' under Section 2(26) of the Customs Act as also to the provisions of Section 28(1) of the Act. They submitted that only one person could be the importer of any goods and h....