TaxTMI 
TaxTMI 
TaxTMI 
2019 (4) TMI 1541
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....ttee (UAC) as well as the BoA had taken an adverse view with regard to certain bills of entry and the penalty of Rs.50 lakhs paid by the petitioner in respect of certain bills of entry. The petitioner claims that the penalty was paid without prejudice and without admitting any default. More importantly, the petitioner has succeeded before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) and the said amount is now required to be returned to the petitioner. The petitioner further claims that the UAC had also failed to appreciate that the petitioner was permitted trading activities. It is also contended that the petitioner had achieved positive foreign exchange inflow. However, since the records had been seized, the petitioner was handicapped from establishing the foregoing. 3. Initially, it was contended that the Development Commissioner of the SEZ was a member of the UAC of Noida SEZ, which had taken the decision to cancel the LOA issued to the petitioner and also one of the members of the BoA, which had heard the appeal against the order of the UAC. In this context, it is averred in the petition that the decision of the BoA was vitiated. However, at the stage of fin....
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....ccepted by the Development Commissioner, Noida SEZ and the Specified Officer. 8. On 05.01.2016, the BoA sent a communication informing the petitioner that a meeting was scheduled on 06.01.2016 for personal hearing and calling upon the promotors/officials of the petitioner to be present in the said meeting. The petitioner replied to the said communication requesting for an adjournment of the meeting on account of being "pre-occupied for some urgent work". 9. The meeting took place on 06.01.2016 as scheduled and the Unit Approval Committee (UAC) found that the petitioner had not been manufacturing items and undertaking trading activities in terms of the letter dated 30.06.2003 (whereby the LoA was amended), and has been "regularly indulging in mis-declaration of goods in Bills of Entry". It was observed that the petitioner has not been performing its export obligations but has been working only as a channel for domestic importers, by importing the goods and selling them entirely in the domestic market. The UAC also held that the petitioner unit has not achieved positive NFE and has failed to abide by the terms & conditions of the LOA/Bond-cum-LU. 10. In this view, the UAC, inter a....
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....d to Special Intelligence & Investigation Brach (SIIB) to decide the matter on merits and stated that he did not want any Show Cause Notice of personal hearing. 11. The Committee further observed that Rule 27(10) of SEZ Rules, 2006 provides that the assessment of imports by a unit shall be on the basis of self declaration and not subject to routine examination. Hence, the import clearance is on self declaration basis and trust is imposed on the SEZ unit that it gives correct declaration and files correct Bill of Entries. The unit has persistently violated the rule &persistently mis-declared the goods in Bill of Entries." 14. In view of the aforesaid observations, the UAC, decided to cancel the LoA and further called upon the petitioner to complete the exit formalities under Rule 74 of the SEZ Rules, 2006. 15. The aforesaid decision was communicated to the petitioner by a letter dated 23.02.2016. The petitioner was further called upon to furnish requisite details for the determination of duty liability. 16. Thereafter, the petitioner filed an application under the Right to Information Act, 2005, inter alia, seeking the information as to whether its reply dated 04.02.2016 sent i....
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.... the rules made thereunder, and the terms of the LoA; the petitioner had admitted to mis-declaration of goods and had paid the penalty of Rs.50 Lakhs; and the petitioner has been mainly trading in DTA and there has been hardly any physical exports. 21. In view of its conclusions the UAC had directed suspension of the LoA and thereafter, cancelled the LoA in its meeting held on 10.02.2016. 22. The petitioner's appeal against the decision of the UAC was rejected by the BoA at its meeting held on 09.11.2016. 23. A plain reading of the impugned decision of the BoA indicates that the petitioner's appeal had been rejected on the ground that the petitioner had not furnished details of import, export and sales in the domestic tariff area in the prescribed format. It is also observed that the petitioner had failed to provide details of Free Foreign Exchange received from overseas and, therefore, it was not possible to ascertain the Net Foreign Exchange (NFE) position. The BoA also noted the observations of the UAC. The impugned decision of the BoA is set out below:- "M/s Morgan Tectronics Ltd. (MTL) has preferred an appeal against the order dated 23.02.2016 passed by the DC. NSEZ/UAC w....
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....above, after detailed deliberations, the BoA observed that no grounds have been made for the appeal and hence rejected the appeal." 24. As is apparent from the above, the petitioner's explanation that its records had been seized by the DRI and, therefore, they were not in a position to submit the same, was not accepted by the BoA. The BoA held that the details of payments received from EFFC account or from overseas buyers would be through normal banking channels and the same could be provided by the petitioner. 25. It is contended on behalf of the petitioner that LoA had been extended from time to time as the petitioner had been regularly achieving a positive Net Foreign Exchange position. It is contended that the petitioner was unable to provide the requisite details at the material time as its records had been seized, however, is now in a position to provide the same. 26. It is also noticed that the BoA had also taken an adverse view regarding the mis-declaration of goods covered under certain Bills of Entry (BoE NSEZ008568 dated 05.10.2015and BoE NSEZ0008527 dated 03.10.2015). It had also noticed that the petitioner had paid an aggregate sum of Rs.50 lakhs towards duty/penalt....