TaxTMI 
TaxTMI 
2026 (1) TMI 1461
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....nos. of Gear Boxes contained in the export container was brought back to the factory for quality inspection and later found to be damaged. Hence, they requested for permission for destruction of the said goods at their premises without payment of duty and for removal of the scrap/wastage on destruction of the said goods on payment of duty in terms of Para 6.8(f) of the Foreign Trade Policy (FTP) read with Para 8(ii) of Notification No.52/2003-Cus dated 31.03.2003 and Para 3(iii) of Notification No.22/2003-CE dated 31.03.2003. Consequently, they were directed to pay duty on the value of the goods damaged and not on the scrap value. As appellant has not paid the duty on the value of goods, information were called for from the appellant including the insurance claim on damaged goods in transit relating to the consignment in 2012 as well as the past consignment in February 2008. On the basis of the information submitted and later collected from the insurance company, show-cause notice was issued to the appellant on 20.02.2013 for recovery of the total duty of Rs.34,70,133/- against the value of the goods cleared vide invoice dated 19.01.2012 and 04.02.2008, which got damaged during the....
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....sed. When they sought permission of the Department for destruction of the goods as the same could not be repaired or reconditioned, permission was not accorded and show-cause notice was issued demanding duty of Rs.34,70,133/- for both the consignments i.e. clearances made during February 2008 as well as January 2012. He has submitted that the adjudicating authority has dropped the demand after taking note of the fact that they have correctly followed the procedure availing benefit of Notification No.22/2003-CE. On an appeal filed by the Revenue, the learned Commissioner (Appeals) set aside the order by travelling beyond the scope of the show-cause notice and made out entirely a new case which was never alleged in the show-cause notice. In their appeal, the Revenue raised the issue of availing the benefit of Notification No.22/2003-CE dated 31.03.2003 and when the goods were not exported, demand of duty on the goods imported used in the manufacture of final products would arise; hence, the appellant was to discharge duty as required under Notification No.22/2003-CE dated 31.03.2003. But the impugned order travelling beyond the scope of the notice and referring to certain judgments w....
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....nd Granites Ltd. Vs. CCE [2009(239) ELT 120 (Tri. Chennai)] ii. TAB India Granites (P) Ltd. Vs. CCE [2017(8) TMI 1161 - CESTAT Chennai] iii. LA Mansion Granites Ltd. Vs. CCE [2003(157) ELT 115 (Tri. Bang.)] 3.3. He has further submitted that the impugned order is contrary to the Rule 21 of CER, 2002 as the appellant are entitled for remission of duty on goods destroyed lying within the factory premises. In support, they have referred to the following judgments:- i. Kuntal Granites Ltd. Vs. CCE [2007(215) ELT 515 (Tri. Bang.)] ii. Honest Bio-Vet Pvt. Ltd. Vs. CCE [2014(310) ELT 526 (Tri. LB)] iii. Tata Coffee Ltd. Vs. CCE [2007(219) ELT 551 (Tri. Bang.)] iv. CCE Vs. Sree Narasimha Textiles Ltd. [2009(239) ELT 86 (Tri. Chennai)] 3.4. Further, he has submitted that invocation of extended period of limitation is bad in law since the goods were destroyed in the presence of the Departmental officers after taking due permission and all their actions were bona fide and not mis-declared or misstated. 4.1. Learned AR for the Revenue has reiterated the findings of the learned Commissioner(Appeals). Distinguishing the judgment of t....
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....gate. Since the ownership has been changed at the factory gate and the goods have not been exported, its clearance to DTA is beyond doubt. Further, the appellant have realised that the total consideration towards the clearance of impugned goods and the transaction for clearance to DTA attained finality; hence, they are required to pay applicable duty as per Section 3(1) of Central Excise Act, 1944 read with Rule 17 of CER, 2002. Further, he has submitted that the permission allowed in 26.03.2008 is not a quasi-judicial order and it is a communication by the Superintendent of Central Excise and Service Tax; hence, no appeal is required to be filed against the said permission. Further, he has submitted that invocation of extended period of limitation is justified as the appellant has not disclosed all the facts. 5. Heard both sides and perused the records. 6. The limited issue involved in the present appeal for consideration is whether the appellant is required to discharge duty on the returned goods received in the factory after being damaged during the course of transit to the Chennai Port for export. 7. Undisputed facts of the case are that the appellant had cleared 576 n....
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....cture', and collected on "removal", the term 'removal' is more relevant, which would apply to place from where the sale takes place or the ownership of goods transferred from seller to buyer at the time of removal from such place. The provisions of Rule 21 of the Central Excise Rule 2002 provides that Remission can be allowed when goods in question have been lost or destroyed by natural causes or by unavoidable accident or are claimed by the manufacturer as unfit for consumption or for marketing, at any time before removal. Hence, in absence of any clear definition of 'Removal', in our considered view, the phrase "place of removal" is an important expression/factor, which has to be decided first for charging duty or considering Application for Remission of duty. In the present case, question of Remission of duty is under consideration, we will confine our views only to the question of Remission of duty. The Appellant claims that they had cleared goods on CIF sale basis for export, but such sale would be completed at the port of shipment because in terms of CIF Sale Contract, (i) the ownership of goods and the property in the goods remained with the seller [appellant] of th....
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.... is the port of shipment. Accordingly, we have no hesitation in following the recent decision of the Hon'ble Gujarat High Court in case of Commissioner v/s Dynamic Industries Ltd in the Tax Appeal No. 912 of 2012 decided on 25.07.2014, wherein the Hon'ble High Court has also upheld view taken by CESTAT to the effect that 'port of shipment is the 'place of Removal' in the cases of exports'. Once such a view is taken, we find that the decisions in case of Kuntal Granites ltd v/s C.C.E reported at 2007 (215) ELT.515 (Tri-Bang.) and followed in subsequent decisions like in case of Liva Healthcare Ltd v/s CCE, Nasik - 2008 (222) ELT 243 (Tri. Mum.) and others is a good law, and requires to be upheld. There is no reason to take a different view. 14. We are of the view that the goods cleared for export under Bond which were destroyed before the same could be exported, can be treated as having been destroyed before removal only. This would be the fair interpretation of the Rule 21 of the Central Excise rule 2002. Thus, primary condition of eligibility of Remission of duty on the destroyed goods is fulfilled as required u/r 21 of Excise Rules 2002. Appellant is eligible for the Rem....