TaxTMI 
TaxTMI 
2023 (9) TMI 418
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....e 8 of Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 (herein after this Rules will be called as Customs Rules, 1996) read with Section 28 (5) of Customs Act, 1962 along with interest. 3.1 Brief facts of the appeal are that the appellant is engaged in the manufacture of Modular Switches and Parts falling under Central Excise Tariff Heading No. 85369090 and 85389000 of the Central Excise Tariff Act. The appellant imported parts of Relays, Switches and Connectors availing the benefit of concessional rate of duty as per Notification No. 25/99-Cus dated 28.02.1999. In order to avail the above concession, the importer/manufacturer has to comply with the provisions of Customs Rules, 1996. Accordingly, the appellant obtained Registration Certificate dated 27.05.2004 as per Rule 3 of the Customs Rules, 1996 which was effective upto 22.09.2011. The appellant has also executed a bond as required under the Customs Rules, 1996 and filed periodical returns under E.R. 1 with the Department. The imported materials were received in the factory of the appellant and various processes required for the manufacture of modular switch assembly were ....
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.... of fine and penalty as mentioned in paragraph 2 above. 4.1 The Ld. Advocate Shri T. Ramesh has submitted that the appellant has complied with all the conditions of Notification No. 25/99-Cus dated 28.02.1999 read with the Customs Rules, 1996 and there was no dispute regarding receipt of the imported goods in their factory premises, and required manufacturing activities were carried out for manufacture of final product Switches and Modular Plates. He has submitted that all the manufactured sub-assemblies/parts of switches in SKD/CKD condition from Samichettypalayam unit at Coimbatore were cleared on payment of Central Excise duty to their unit at Una, Himachal Pradesh. Their factory at Una has received only such assemblies/sub-assemblies from their factory at Coimbatore and no other parts/sub-assemblies were received from outsiders during the entire disputed period. These parts and sub-assemblies were assembled and final product switches were packed and cleared to the customers from their unit at Una thus, complied with all the conditions of the Notification read with the Customs Rules, 1996. 4.2 The Ld. counsel has argued that as per the Rule 3 of the Customs Rules, 1996, the ap....
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....sued on 14.07.2011 only. It is argued that the Show Cause Notice has not been issued under Section 28 of the Customs Act, 1962 and extended period has not been invoked. There is no suppression with an intent to evade payment of duty and the appellant has complied with all the conditions of the Notification No. 25/99-Cus dated 28.02.1999. The Department had full knowledge of the activities of the appellant and the goods cleared from one unit of the appellant to other unit at Himachal Pradesh was on payment on Central Excise duty. The appellant has filed periodically statutory returns declaring the use of imported materials for the manufacture and clearance of parts/sub-assemblies in SKD/CKD condition to their unit at Una and so the demand is barred by limitation for the period prior to 14.07.2010 as there is no suppression involved. 5. The Ld. Authorised Representative Shri R. Rajaraman supported the findings of the lower appellate authority. He has submitted that the imported goods were not used for the manufacture of finished goods i.e, Switches as mandated in the Notification No. 25/99-Cus dated 28.02.1999, so, the appellant is not eligible for the benefit of the concessional ra....
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....nt in this Case has manufactured not complete Relays/Switches/Connectors but parts of these products which were admittedly cleared entirely to their unit at Una, Himachal Pradesh. 8.2 The contention of the Revenue is that the appellant has contravened the provisions of the Notification read with the Customs Rules, 1996 by not manufacturing the Switches in the declared premises. As a result, in terms of Rules 8 of the Customs Rules, 1996, a demand was raised for recovery of concessional rate of duty availed by the appellant on imported goods. For ease of reference the relevant part of the Notification is extracted below: - Sl. No. Chapter Description of Imported goods Description of finished goods 1 2 3 4 112 85 Part of Relays, Switches, Connectors Relays, Switches and Connectors 8.3 Rule 3 and 8 of the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 reads as follows:- "Rule 3. Registration. - 1. A manufacturer intending to avail of the benefit of an exemption notification referred to in sub-rule (1) of rule 2, shall obtain a registration from the Assistant Commissioner of Central Excise or Deputy Commissioner ....
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....ules, 1996 for availing either exemption or concessional rate of duty in order to ensure that the imported goods are used in manufacture of specified goods and duly accounted for. These Rules are framed so that the jurisdictional authority could monitor the utilization of the goods imported at concessional rate of duty. The appellant by not intimating the Department regarding clearance of not the final products as envisaged in the Notification but by clearing only parts of Switches to their another unit located in another state, has contravened the provisions of the said Notification and the Customs Rules, 1996. The decisions of the lower adjudicating authorities could not be found fault with when they upheld that imported goods had not been used for the intended purpose. We refer to the decision of the Apex Court in the case Mihir Textiles Ltd. Vs. Commissioner of Customs, Bombay [1997 (92) ELT 9 (SC)], wherein it was held that when concessional relief of duty is made dependent of satisfaction of certain conditions, the relief cannot be granted in the absence of satisfaction of the conditions even if the conditions are only directory. 9.1 We find some merit in the contention that....
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....andas v. H.H. Dave - (1996) 2 SCR 253, held that such a notification has to be interpreted in the light of the words employed by it and not on any other basis. This was so held in the context of the principle that in a taxing statute, there is no room for any intendment, that regard must be had to the clear meaning of the words and that the matter should be governed wholly by the language of the notification, i.e., by the plain terms of the exemption." 9.2 Further, the Hon'ble Supreme Court in the case of Commissioner of Customs (Import), Mumbai Vs. Dilip Kumar & Company [2018 (361) ELT 577 (SC)] has also held that the words in a statute when clear, plain and unambiguous and only one meaning can be inferred, Courts bound to give effect to the said meaning irrespective of consequences. In applying the rule of plain meaning any hardship and inconvenience cannot be the basis to alter the meaning to the language employed by the legislation especially in fiscal statutes. The relevant paragraph is extracted below:- "19. The well-settled principle is that when the words in a statute are clear, plain and unambiguous and only one meaning can be inferred, the Courts are bound to give effe....
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....he notification prescribing the end use as a condition. 10.4 In the case of Electronic Research Ltd. supra, the goods imported with duty concession for use at one factory were transferred to another unregistered factory located at another place after informing the jurisdictional officers. Whereas in this case, such an intimation has not been made. The appellant must be aware of the fact that complete switches are not scheduled to be made in their Coimbatore factory. During the entire period of dispute, complete switches are never made and only parts/sub-assemblies were made and transferred to their unit at Una, Himachal Pradesh for completing the final process or for manufacture of the Switches. No reasons are given for not informing the jurisdictional Central Excise and Customs authorities concerned. 10.5 In the case of FDC Ltd. supra, the imported goods were sent to the job worker and the ownership of the goods remained with the appellant right from import of goods till their utilization in the manufacture of the final product and it is held that end use condition was satisfied. Whereas in this case, semi-finished parts were cleared to their unit at Una, Himachal Pradesh on pay....