2015 (2) TMI 655

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....ich were being procured indigenously from local market. They imported capital goods free of customs duty. The unit applied for de-bonding to Development Commissioner. On 23.4.2009 the jurisdictional Assistant Commissioner gave NOC for de-bonding . According to the Department during 1.4.2009 to 23.4.2009, there was no production and clearance of any finished goods. The unit subsequently de-bonded and converted into a DTA unit. 1.1 The records of the appellant were audited in course of which the officers they checked the trial balance sheet and also other records. Scrutiny of ER-2 returns for the years 2007-08 & 2008 09 revealed that there was opening balance of 1089 packets of handicrafts as on 1.4.2007 and total, 52771 packets and 52472 ....

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....his, he also demanded interest under Section 11AB on the duty demand confirmed and imposed penalty of equal amount on the appellant under Section 11AC. 1.4 On appeal being filed before Commissioner (Appeals) along with stay application, the Commissioner (Appeals) vide stay order dated 31.7.2013 directed the appellant to pre-deposit 25% of the duty demand confirmed for compliance with the provisions of Section 35F of the Act. The appellant filed modification application and the same was rejected vide order dated 30.10.2013 and the appellant was once again directed to deposit 25% of the duty demand. Since the appellant did not deposit the directed amount, their appeal was dismissed vide final order dated 24.12.2013. While Appeal No.E/60683....

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....ial balance sheet was of the duty paid raw materials, packing materials etc. ; that merely on the basis of trial balance sheet, the duty demand cannot be confirmed when as per the Superintendent s physical verification report, as on 1.4.2009 there was no stock of finished goods or raw materials procured without payment of duty; that though these pleas have been made before the Commissioner (Appeals) in the course of hearing of stay applications, the same have not been considered or even discussed in the order; that in view of this, the impugned order passed by the Commissioner(Appeals) directing pre-deposit of 25% of the duty demand and subsequently rejecting the appeals for non-compliance of the stay order , are not correct. 5. Shri M.S....