2019 (6) TMI 646

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....and of customs duty of Rs. 27,95,048/-. 2. Learned Counsel for the appellant submits that the unit in SEEPZ was eligible to import gold and silver without payment of duty for manufacture of export products under notification no. 177/94-Cus dated 21st October 1994. It is his contention that the shortage of stock is nothing but the normal processing loss. It is his further contention that if wastage allowance is taken into account, no liability would arise. It is also contended by him that there is no allegation of any illicit removal and, therefore, the confirmation of notice was not correct in law. He placed reliance on the decision of Tribunal in Delco Precitone Jewellers (P) Ltd v. Commissioner of Customs, New Delhi [2000 (124) ELT 1105 ....

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....s Gross In gms 51660.92 4648.42 56309.34 It shows that 56309.34 gm of gold jewellery had been exported for which 4648.42 gm wastage loss was considered. There has been an additional export of 59.42 gm of gold Mounting, which has also been taken into consideration at page 9 of the stock detal statement, making the Gross wt. of export to 56368.76 gm. 21. I also find that gold consumption statement for the year 1998-1999 (Gold in 0.995 purity) submitted by the Director of M/s Renaissance Gem & Jewellery Export Pvt Ltd, duly signed on 01.12.1998 at the time of stock taking at page no. 54 shows as following. A TOTAL IMPORT OF GOLD 84777.48   LESS TOTAL EXPORT 56368.76   BALANCE 28408.72       B G....

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....s been diverted by the appellant to other parties. As such, if the entire imported gold has been used for manufacture of gold jewellery to be exported, no duty on the quantum of gold not actually contained in the final product can be demanded. We also note that the quantity of gold recovered by the appellant from slurry/dust is required to be treated as part of stock in hand and cannot be attributed to shortages. If such gold recovered from dust is adjusted against the shortages arrived at the time of physical stock taking, the percentage loss would be within the permissible limits in the notification. Similarly, in the absence of any evidence to the contrary, we find no justification for confirming demand of duty in respect of wastage of f....