2018 (5) TMI 268

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....e goods Coco Butter and their factory is situated in the state of Jammu & Kashmir. The appellant was issued advance authorisation dated 24.01.2007 by the Jt. Director, DGFT for duty free clearance of Cocoa Paste imported total One lakh MTs and were required to export of Coco Butter against the same. Against the said advance authorisation, the appellant imported 100 MT of Cocoa Paste, vide two bills of entry duty free in terms of Notification No. 93/2004-Cus dated 10.09.2004. Due to an accident beyond the control of appellant, 50MT of Cocoa Paste imported against one bill of entry dated 26.4.2007, lost due to melting in transit and as a result of which some leaked cartons were unusable. The said quantity was reduced in the balance of importe....

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.... As the imported goods were not used for manufacturing of the goods which are to be exported therefore, duty is sought to be demanded and by way of impugned order, the demand of duty was confirmed on the ground that imported goods were not used in the manufacture of goods exported. Therefore, the appellant is liable to pay duty on the imported goods along with interest and it was ordered for confiscation of the Cocoa Paste imported by the appellant and redemption fine of Rs. 75,00,000/- was imposed and penalty of Rs. 25,00,000/- was also imposed. On appeal, ld. Commissioner (Appeals) reduced the redemption fine to Rs. 35,00,000/- but rest of the adjudication order was confirmed. Against the said order, the appellant is before us. 3. Ld. ....

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....espect of Coco Butter which was purchased locally and used to discharge export obligations. Therefore, demand against the appellant is not sustainable in the light of the decision of Hon'ble Apex Court in the case of CC, New Delhi vs. C.T. Scan Research Centre (P) Limited - 2003 (155) ELT 3 (SC). 4. On the other hand, ld. AR reiterated the findings of the impugned order and submits that, as the appellant themselves admitted that imported goods were not used in the manufacture of finished export goods and as per the condition of advance authorisation, the imported goods are to be used in the manufacture of export goods. Therefore, the duty has rightly demanded from the appellant and redemption fine and penalty were also rightly imposed on....

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.... advance licence issued, the petitioner was entitled for duty free import of die steel as a material required in the manufacture of export product. Once the Licensing Authority has accepted that die steel is a material required in the manufacture of the export product, it is not open to the Customs Authorities to go behind the licence and deny duty free clearance of the goods. The exemption Notification No. 116/1988, dated 30th March, 1988 specifically states that the materials that are required to be imported for the purpose of manufacture of resultant products shall include such items as are imported into India against the advance licence for subsequent exportation. In the instant case, the licence specifically states that the petitioner ....

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....case of Titan Industries Limited (supra) observed as under:- "8. From the aforesaid decisions, it becomes clear that once export obligation has been met, it is not for the customs authority to insist for the nexus in respect of matters coming under this special scheme. If any import is in contravention of the licence, it is for the licensing authorities to take action and not for the customs authorities. It is stated by the first respondent that the customs authorities have already made correspondence in the matter with the licensing authorities. Therefore, it is for the licensing authorities to take action, if it is so required under the law. But the customs authority cannot refuse to release the bank guarantee merely because the matter....