TaxTMI 
TaxTMI 
TaxTMI 
2019 (8) TMI 336
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....ntial duty. 2. Appellant filed bills of entry no. 833/02.06.1993 and 8072/23.07.1993 for import of machinery seeking clearance by classifying them under heading 9801 of First Schedule to Customs Tariff Act, 1975 applicable to 'project imports' but was assessed to appropriate duty with availment of notification no. 160/92-Cus dated 20th April 1992 intended for implementing scheme in EXIM Policy (1990-1993) for import of 'Export Promotion Capital Goods' with obligation to goods valued at of Rs. 42,13,83,648/- by December 1997. Admittedly, the obligation was not fulfilled. 3. According to Learned Counsel for appellant, the proceedings initiated in the show cause notice should not have been concluded while the assessments, claimed to be provisional, was yet pending for finalisation for which the decision of the Hon'ble Supreme Court, in Commissioner of Central Excise & Customs, Mumbai v. ITC Ltd [2006 (203) ELT 532 (SC)], holding that '21. Concededly, in terms of the provisions of the Act and the Rules framed thereunder, the amount becomes payable only in the event, the assessee does not deposit the amount levied within a period of ten days from the date of completion of ....
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....ssioner of Customs, Mumbai [2001 (137) ELT 697 (Tri- Mumbai), in VBC Industries Ltd v. Commissioner of Customs, Chennai [2003 (156) ELT 872 (Tri-Bang)], that in Fal Industries Ltd v. Commissioner of Customs, Chennai [2008 (231) ELT 524 (Tri- Chennai)] which found approval of the Hon'ble High Court of Madras in appeal of Revenue, in Femco Filters (P) Ltd v. Commissioner of Customs, Bangalore [2006 (203) ELT 494 (Tri-Bang.)] which was affirmed by Hon'ble Supreme Court and in South India Corporation (Agencies) Ltd v. Commissioner of Customs, Trichy [2009 (244) ELT 581 (Tri-Chennai)] affirmed by Hon'ble High Court of Madras on appeal of Revenue. 6. Per contra, Learned Authorised Representative placed reliance on the decision of Tribunal in Sanghi Industries Ltd v. Commissioner of Customs (Export Promotion), Mumbai [2012 (277) ELT 365 (Tri- Mumbai)] and that of the Hon'ble High Court of Bombay in Commissioner of Central Excise, Aurangabad v. Padmashri V V Patil SSK Ltd [2007 (215) ELT 23 (Bom)]. It was also pointed out by Learned Authorised Representative that the Tribunal, in Parasrampuria Synthetics Ltd v. Commissioner of Customs, Jaipur [2004 (173) ELT 164 (Tri-Del)]....
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....ssued under section 25 of Customs Act, 1962 over the scheme in the EXIM Policy has been clearly explained thus: '10. The departmental representative points to the provisions of paragraph 45 of the Policy, and paragraph 103 of the Handbook of Procedures referring to the legal undertaking required to be furnished by the importer and applying for a EPGC licence. This undertaking provides a clause that the importer shall pay full amount of Customs duty saved, and 24% interest thereon, for the total CIF value of imported goods from the date of import, in the event that the capital goods are not used for the purpose for which they were imported. 11. There is clearly a conflict between what is contained in the undertaking and what is contained in the notification. The undertaking provides for recovery of proportionate duty, that is the duty other than the "full amount of Customs duty saved". The meaning of the words occurring in the undertaking will only be that the duty is payable in case the export obligations is not completed has to be in proportion to the extent of shortfall in that export obligation. The notification, however, is clear that it is the entire duty that is to be pa....
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....ed within a period of five years i.e., by November, 1998. Therefore, the liability to pay the differential duty arose in 1998, when the period for fulfilling the export obligation expired and the obligation was not fulfilled. Section 28AA and 28AB came into the statute book in 1996 itself and, therefore, in the light of the decision of this Tribunal in the case of Parasrampuria Synthetics Ltd. (cited supra) the provision for charging interest was in the statute book. Secondly, interest has been demanded not under the provisions of the above Sections, but in terms of the bond and LUT executed by the appellant before the Customs and the licensing authorities and in terms of the Policy provision governing EPCG scheme. At the relevant time, Export Promotion Capital Goods Scheme was governed by Chapter VI of the Export Import Policy 1992-97. The capital goods in the instant case have been imported under the said provision. Vide Para 45 of the Exim Policy 1992-97, the importer was required to execute with the licensing authority a legal undertaking supported by a bank guarantee wherever necessary for the fulfilment of the export obligation as per the details specified in the Handbook of ....
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....law. Demand of duty arises on importation of the goods and if goods have been imported at a concessional rate of duty subject to fulfilment of certain conditions and such conditions are violated, then the duty concession would not be available at all. In the case under consideration, the demand of duty has arisen under the Notification itself in terms of the bond executed by the importer at the time of importation of the goods. Confiscation of the goods arise under Section 111 of the Customs Act in certain specified situations. Section 111(o) reads as follows : "Any goods exempted, subject to any condition, from duty or any prohibition in respect of the import thereof under this Act or any other law for the time being in force, in respect of which the condition is not observed unless the non-observance of the condition was sanctioned by the proper officer." In such an eventuality, the goods imported shall be liable to confiscation. In the instant case the goods were imported availing a concessional rate of duty on the condition that the goods will be put to use for manufacture and export of certain products up to certain value within a specified period. When the importer failed....
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....of the goods on payment of fine in lieu of confiscation under section 125 of the Customs Act. The goods were released to the appellants at the time of importation under a bond executed by the appellant. The release of the goods was thus provisional. Therefore, when the assessment is finalized subsequently, even if the goods are not available for confiscation, redemption fine in lieu of confiscation can be imposed as has been held in a number of judicial pronouncements on the subject. Therefore the imposition of redemption fine in the instant case is fully justified and is quite legal and we hold accordingly.' 9. However, a plethora of decisions of the Tribunal have held that the notifications issued in pursuance of the EXIM Policy, having provided for the alternative of payment of duty in the event of failure to fulfil the export obligation, renders the discharge of either of these option to be sufficient compliance with the condition to be fulfilled in the relevant notification issued under Customs Act, 1962, thus eliminating the scope for invoking section 111(o) of Customs Act, 1962 to confiscate the imported goods. Furthermore, in re Sanghi Industries Ltd, it was the deliberate....