TaxTMI 
TaxTMI 
2012 (7) TMI 29
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....ion of goods Quantity Value (Rs.) Duty Involved (Rs.) 1. Clock Movements (Foreign Origin) 33031 Pcs. 1008350.00 453760.00 2. Craft Paper (Indigenous) 109.475 MT 1478000.00 238314.00 3. Zinc Ingots (Foreign Origin) 381.84 Kgs. 17183.00 7797.00 Total 2503533.00 699871.00 4. The following materials were detected at the premises of CLG for which they were not able to show proper documents : Sl. No. Description of goods Quantity Value (Rs.) Duty Involved (Rs.) 1. Zinc Ingots (Foreign Origin) 11.364 MT 852288.00 386683.00 2. Tin Ingots (Foreign Origin) 690.000 Kgs. 293250.00 131962.00 3. Clock Movements (Foreign Origin) 14180 Pcs. 583010.00 262354.00 4. Lamp Parts (Foreign Origin) (i) Cords (ii) Holders 2368 Pcs. 1272 Pcs. 49515.00 12720.00 22516.00 Total 1790783.00 806515.00 5. Truck No. UP-21D9111 200000.00 TOTAL 1990783.00 5. It was very evident that goods imported duty free by JSG were diverted to CLG. JSG had not followed the pr....
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....ies. The fact of export is established by the records of the Development Commissioner. 11.10 According to the Development Commissioner, Noida, Special Economic Zone, Noida F.No. 03/243/2000 - 100% EOU/11693, dated 18-10-2006, the noticee (now known as M/s. C.L Gupta & Exports Limited) have earned the foreign exchange, during the last five years as under : Year Outflow Inflow (On account of imports) (Rs. in Lakh) (On account of Exports) (Rs. in Lakh) 2001-02 225.92 2287.98 2002-03 550.84 4754.01 2003-04 1115.01 6686.18 2004-05 752.21 9715.13 2005-06 1554.03 10402.30 it is seen from the above figures that the EOU have fulfilled their export commitment/obligation by exporting a value far in excess of their value of imports. 11.11 Moradabad is a world renowned centre for manufacturing and export of handicrafts. A large variety of handicrafts are made in different stages. As is expected in a handicrafts industry, all the goods are made by hand based on traditional expertise of artisan. Different processes are undertaken by different hands, at scattered premises. A single item may comprise of differe....
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....iled verification regarding receipt back of processed materials out of duty free imported material from the sister concern - M/s. C.L. Gupta & Sons, which was sent for job work by the EOU - M/s. J.S. Gupta & Sons was got conducted through the jurisdictional Range - Amroha/Division Hapur under the supervision and active participation of officers deputed from the Commissionerate Headquarters. Under letter C. No. 20-C.E./100% EOU/ACL/Amroha/07/226 dated 8-4-2007, it has been reported that the verification of details of Annexures III, IV and V to the show cause notice was carried out on the basis of the gate passes of M/s. C.L. Gupta & Sons Rampur Road, Moradabad, and the corresponding export invoices/packing list and other documents of M/s. J.S. Gupta & Sons (now M/s. C.L. Gupta Exports Limited, Village Jivai, J.P. Nagar). The serial number of invoices as mentioned on most of the gate passes were found to be the same as mentioned on the invoices/packing provided by the EOU. In cases where invoice numbers were not mentioned on the gate pass, the same were correlated/verified on the basis of details of gate passes provided by the party." 9. Aggrieved by the order of the Commissi....
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....re the adjudicating authority in paras 8.8 to 8.14 in the adjudication order which are reproduced below : "8.8 M/s. JSG came into existence in 2000 and was established as a 100% EOU under LOP dated 15-12-2000 issued by the Development Commissioner, NSEZ and on creation of JSG, a part of the CLG-II factory at Jiwai was transferred to JSG which was later appointed as a private bonded warehouse and manufacturing unit under Section 58 and Section 65 of the Customs Act, 1962 vide a warehousing Licence No. EOU/17/2001 dated 18-1-2001 issued by the Jurisdictional Central Excise Division, Moradabad. Though on creation of the JSG, the larger part of the unit at Jiwai was converted into 100% EOU and declared a bonded area, a part comprising a two storey building was retained by the CLG, Unit-II and was not bonded. 8.9 On creation of JSG, most of the staff, artisans and workers working at CLG-II, were absorbed in JSG with effect from January 2001 and thereafter they were engaged in the manufacturing of the products for JSG. In addition, further labour force was augmented from CLG (HQ) and new recruitment. However, some of the experienced and old job w....
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.... material received from them was also entered into the same. The payments to job workers were thereafter made after deduction of TDS. 8.14 The manufacturing of brass artware and the allied products is basically a labour intensive manufacturing process carried out by individual artisans having expertise in various aspects of manufacturing such as casting, carving, polishing, art work etc. which are basically handicrafts. Due to this peculiar nature of operations, an inventory control system and issue, receipt system have been devised and developed over decades to suit the peculiar operations of the industry which is prevalent in most of the manufacturing units at Moradabad." 13. To prove that their actions were bona fide they further drew attention to their submissions before adjudicating authority recorded in para 8.4 of the impugned order : "8.4 M/s. J.S. Gupta & Sons, the 100% EOU, commenced commercial production with effect from 19-5-2001 and performed extremely well on export front and achieved commendable Net Foreign Exchange Earnings. The particulars of export, import and Net Foreign Exchange Earnings during the last 5 years were detailed as bel....