TaxTMI 
TaxTMI 
2001 (8) TMI 203
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....itself to fulfil the obligation and conditions stipulated in the notification to pay on demand the duty payable but for the exemption on that quantity of raw materials and components which have not been proved to the satisfaction of the licensing authority to have been used for the purpose specified in the notification and requires the importer to produce evidence to the satisfaction of the licensing authority for the purpose of discharging the liability in respect of customs duty as well as discharging the obligations under the import licence. 2.The appellant did not use any of the stainless steel plates in the manufacture of thread protector due to technical problems. It made thread protectors out of carbon steel which it purchased from the market and supplied them to ONGC. 3.The appellant executed the necessary bond with the licensing authority. The supply was made between November, 1989 and August, 1990. In June, 1990 the appellant applied to Chief Controller and Import and Export for discharging the bond which it executed in respect of the first licence and in October for the second. That authority discharged the bond in September and November, 1990. The appellant had in....
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....e notification itself has been wrongly extended to the goods. He finds that the appellant had no such intention to utilise the imported material in the manufacture of the thread protectors. And that even when the appellant applied for special import licences it had no intention to utilise the material for manufacture of the thread protectors. 7.We do not find any basis to interfere with the conclusion of the Collector. The actions and omissions of the appellant relating to the imported goods lead us to conclude that it did not at any point of time have any serious intention to utilise the imported goods in the manufacture of the goods to be supplied to the ONGC. To begin with, it is clear that when the appellant asked for the import licence for the stainless steel plats in March, 1989, and the licence was issued in July of that year, the appellant did not have any machinery in its factory for making the thread protectors from out of stainless steel plates. The thread protectors are basically caps screwed on to the threads on either end of pipes, to protect the threading from damage during transit and unloading. 8.Bharat Vora, the managing director of the firm, in his statemen....
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....nt made by the importer supported by the certificates given by Punwani, a Chartered Engineer, discharged the undertakings. 11.It is difficult to resist the conclusion that the importer cleverly read upon the lack of co-ordination between the headquarters officers of the licensing authority at Delhi and the office at Mumbai. The appellant's factory and office was not at Delhi but at Mumbai. It would not have been so difficult, had it so wished, to go across to the licensing authority's office and inform them of the failure to utilise the stainless steel plates imported by it. Instead of doing so, it merely proceeds to write a letter to the head office at New Delhi, no doubt, fully aware that the letter would in the course of bureaucratic procedure take around for quite some time. The cancellation of the legal undertaking itself was obtained by mean of incorrect certificates which Punwani, the Chartered Engineer was inveigled into giving as he admits in his subsequent statement. 12.Thus from the beginning to end, the conduct of the importer has been one of deceit dishonestly. Without having the machinery or experience to utilise the stainless steel plates and clearly without an....
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....which exemption was permitted, consciously making the claim for notification. In the background of these facts that we have considered the claim made by the importer for the benefit of the notification is nothing less than deliberate and conscious attempt to mislead the Department. Therefore the finding of the Collector that the extended period contained in the proviso to sub-section (1) of Section 28 of the Act would apply, has to be confirmed. 14.We agree that the demand for duty cannot be made with regard to the 271 tonnes of the stainless steel which ordered to be confiscated. The decision of the Tribunal in INDSU v. CC [1998 (100) E.L.T. 385 (Tribunal)] and Khub Engineering Industries Pvt. Ltd. v. CC [1999 (114) E.L.T. 612 (Tribunal)] would apply. There was no serious attempt by the departmental representative to question this contention. The demand for duty therefore has to be limited to the remaining quantity that the appellant had sold. 15.On the basis of these facts that it is clear that the importer and Bharat Vora are liable to penalty. Bharat Vora in his own statement has admitted that it was he who took the decision to import stainless steel sheets, a fact which ....