TaxTMI 
TaxTMI 
TaxTMI 
2012 (12) TMI 270
X X X X Extracts X X X X
X X X X Extracts X X X X
.... total imports within the prescribed time limit, they obtained another Import Licence No. P/CG/2096953 dated 9-11-1984 for the balance value and items which were not imported against the previous licence dated 6-10-1981. Both the licences were for the substantial expansion of their PFY project for raising the capacity from 960 TPA to 6960 TPA in their plant at Kota. The machinery against the aforesaid licences were cleared at lower rate of duty under Project Import Regulations by paying duty on provisional basis and by furnishing a Bond-cum-Bank guarantee under the Project Import Regulations. The allegation of the department is that as against import of 8 machines permitted under the aforesaid licence, the appellants imported 10 machines. The additional two machines were imported from M/s. Barmag Barmer Maschinenfabrik AG, Germany against Import Licence No. P/CG/2096953 dated 9-11-1984 in the guise of 'Spares and Accessories for Nos. of High Speed Take-up Machines' in violation of Import Control Regulations and the Project Import Regulations. The packing list No. ig/bc dated 24-2-86 accompanying the invoice for the spares bearing the stamp of the State Bank of India, Kanpur describ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....spection could not be conducted. Therefore, a show-cause notice dated 30-5-2006 was issued to M/s. JKSL as to why :- (i) 2 Nos. of High Speed Take-up machines imported in the guise of spare parts and accessories valued at Rs. 69,02,340/- should not be confiscated under Section 111(m) read with 111(d) and 111(o) of the Customs Act, 1962. (ii) The machinery and equipment, which were transferred from PFY Expansion plant to PSF plant in violation of the Project Import Regulations, should not be confiscated under Section 111(d) read with Section 111(o) of the Customs Act, 1962. (iii) Differential customs duty should not be demanded on the said goods. (iv) Penalty should not be imposed under Section 112(a) of the Customs Act, 1962. (v) Project Import benefits should not be denied to the subject imports. The case was adjudicated vide the impugned order and the lower adjudicating authority confirmed the differential duty demand of Rs. 8,27,60,769/- by denying the benefit of project import on the goods imported under Section 28 of the Customs Act, 1962 along with interest thereon under Sect....
X X X X Extracts X X X X
X X X X Extracts X X X X
....iated by the department is liable to be quashed. He has relied on the following judgments in support of the above contentions namely - (i) Government of India v. Citedal Fine Pharmaceuticals - 1989 (42) E.L.T. 515 (S.C.) (ii) E.C. Bose Co. Pvt. Ltd. v. Union of India - 1992 (58) E.L.T. 432 (Cal) (iii) Wilco Company v. Union of India - 2003 (151) E.L.T. 49 (Mad). (iv) Milton Plastics Ltd. - 2007 (216) E.L.T. 210. (b) The learned Advocate further argued that the Commissioner of Customs (Import), Mumbai has no jurisdiction to demand customs duty in the present case. Though the imports were made through Mumbai Port, the goods were bonded and subsequently cleared for home consumption. There is no material evidence cited either in the show-cause notice or in the impugned order to show that the clearances for home consumption was effected through Mumbai Port, thereby giving jurisdiction to the Commissioner of Customs (Import), Mumbai. Therefore, the demand of duty confirmed by the Commissioner of Customs (Import), Mumbai is without jurisdiction. On the other hand, the appellants could....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s v. Commissioner of Customs, Chennai - 2003 (153) E.L.T. 210 (Tri-Chennai) (e) As regards the allegation that the appellants have shifted the machines imported under Project Import from one factory to another factory, it is their submission that the same does not violate Heading No. 9801/84.66 and the Project Import Regulations. The allegation has been made only on the basis of the letter dated 11-4-88 of the appellants, which does not ipso facto mean that any shifting of machinery took place and there is no evidence that the capital goods listed out in the show-cause notice were imported under the Project Import. There is no statement recorded from any person that the shifting of capital goods has taken place and the appellants are also not in a position to confirm or deny the same. In the light of the above, the appellants pray for waiver of pre-deposit of the duty and other dues against them in the impugned order pending final disposal of their appeal. 4. The learned Special Counsel appearing for the Revenue, on the other hand, submits that there is no doubt or dispute about the fact that the goods have been imported under Project Import Regulations and they were as....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ch importers and this Custom House would finalize assessment of their imports on merits and the appropriate heading of the CTA. Thus, specific instructions, in force, at the relevant time make it clear that the importer is required to submit the reconciliation statement within a period of 3 months from the clearance of the last shipment in respect of imports. Thus, the argument of the appellant that submission of reconciliation statement is not mandatory or necessary is not borne out by the facts of the case. 4.2 As regards the jurisdiction of the department to decide the matter, the learned Special Counsel submits that the contracts for the Project Imports were registered as Mumbai Port under Project Import Regulations. The registration and finalization of the contract are essential ingredients for effective implementation of the scheme. As per the Project Import Regulations and the Public Notice issued at the relevant time, it is the port where the project is registered where the contract has to be finalized and on finalization of the contract, the demand of duty will arise. Inasmuch as the finalization of contract is to be done at Mumbai Port, the Commissioner of Customs h....
X X X X Extracts X X X X
X X X X Extracts X X X X
....it the required documents for finalization. Further, a number of developments took place after the import, as discussed in detail in para 14 to 18 of the impugned order. From the details given in the impugned order, it is clear that it is the appellant who was responsible for the delay in finalization of the provisional assessment and, therefore, they cannot allege latches on the part of the department and plead that the demand is vitiated on account of delay. Therefore, the plea taken by the appellants on the basis of judgments cited in support in support of their contention does not apply to the fact of the present case. Reliance placed on Citedal Fine Pharmaceuticals' case, E.C. Bose case, Wilco & Co. case, Milton case (cited supra), dealt with totally different circumstances. Citedal Fine Pharmaceuticals' case (supra) dealt with demand under Rule 12 of the Medicinal Toilet Preparations (Excise Duties) Rules, 1956. The Wilco's case (supra) dealt with delay in imposition of penalty for short-landing the goods. The E.C. Bose case (supra) also dealt with short-landing of the goods and also on the penalty. The Milton Plastic case (supra) dealt with proceedings of end-use certificate....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the project contract has been registered in Mumbai with the Commissioner of Customs, Mumbai. As per the Project Import Regulations, the project contract has to be finalized in Mumbai. Finalization of project contract would invariably include the determination of the fact whether the importer has fulfilled the terms and conditions of project import. It is on the basis of finalization of contract, the demand for differential duty arises. Prima facie, therefore, we are of the view that the Commissioner of Customs, Mumbai has jurisdiction to decide the matter and, therefore, we negative the contention made by the appellants in the matter. In any case, the appellants have not led any evidence to show that clearances for home consumption were made at a place other than Mumbai. Their only argument is that they have lost all the records on account of fire and they are unable to lead any evidence in the matter. 5.5 The next issue pertains to the argument of the appellant that there is no evidence to show that they have shifted the machinery imported for PFY plant to PSF plant. It is on record that vide letter dated 11-4-1988, the appellants themselves, addressed the Directorate Genera....