TaxTMI 
TaxTMI 
2010 (5) TMI 425
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....ervice Tax Appellate Tribunal, New Delhi (hereinafter called as 'CESTAT') vide which the appeals filed by the assessees were allowed and it was directed that the offending goods may be released to the assessees after effective mutilation under the customs supervision thereby rendering the goods as scrap. The Tribunal further directed that the scrap so generated after mutilation be cleared on payment of appropriate custom duty on the loaded value of US$ 105 per meteric tonnee by classifying it under Tarriff Heading 7204.49 of the Customs Tariff Act. For the sake of convenience, facts have been extracted from CUSAP No. 29 of 2008. The Revenue has raised following Questions of Law: a) Whether the action of the Respondent warrants for ....
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....ength and these are fresh and unusable material. The Revenue after completing investigation, issued a Show Cause Notice dated 12.12.2000 to show cause to the Additional Commissioner of Customs as to why the goods should not be classified as MS Rounds falling under Chapter Heading 72.14 attracting duty @ 35%, value should not be assessed @ Rs. 8.82 per Kg., goods should not confiscated and penalty should not be imposed under Section 112 of the Customs Act. The Respondent filed Civil Writ Petition No. 9089 of 2000 before this Court praying release of the goods. This Court while disposing of the Writ Petition vide Order dated 03.05.2000 directed the Petitioner that Petitioner may file reply to the Show Cause Notice and this shall be dispose....
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....oods as scrap whereas on examination material has been found as fresh material. By filing Application for mutilation, the Respondent cannot avoid his liability of enhance duty, fine and penalty. The Counsel further contended that the Tribunal has wrongly relied upon the statement of the Respondent that authorities in the case of identical placed importers have allowed mutilation. There is no evidence of permission for mutilation in the case of other importers. Counsel also contended that the decision of this Court in the case of M/s Dutt Multi Metals Limited deals with interim arrangement for release of goods and does not wipe out liability of the Importer. Per Contra, Counsel for the Respondent heavily relied upon judgment of this Court....
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....-Assessee was unaware of the actual description of the goods. It cannot be assumed that the assessee had been unaware of the description, as he himself had applied for first check. In the present case, duty was assessed on 26.04.2000 and thereafter during the course of examination, the goods were found to be TOR/Ribbed Steel Bars and the Respondent applied for mutilation on 26.05.2000 much after the detection of the offence. In these circumstances, it cannot be held that the Respondent acted in a bona fide manner and he is not liable to fine and penalty. Apart from the above, a perusal of the case file shows that only those goods which are not usable because of breakage, cutting up wear etc. can be considered as waste and scrap. However,....