TaxTMI 
TaxTMI 
2026 (9) TMI 306
X X X X Extracts X X X X
X X X X Extracts X X X X
....rred to as 'the impugned order') passed by the Principal Commissioner of Customs, (NS-General), JNCH, Nhava Sheva. Revenue has also filed an appeal bearing No. C/85291/2016 assailing the impugned order, in pursuance of Review Order No.02/2015-16 dated 04.02.2016 of the Committee of Chief Commissioner of Customs on the grounds that in the impugned order, the learned Commissioner of Customs has failed to impose penalty equal to the amount of duty confirmed therein under Section 114A of the Customs Act, 1962. 2.1 The facts of the case, leading to these appeals, are summarized herein below: 2.2 The appellant company herein inter alia, is engaged in manufacture of process management equipment, including transmitters, liquid analyser systems, gas analyser systems and process control systems etc., and for that purpose had imported various raw materials and used the same for manufacture of final products in their factory situated at Plot No. A-145/4, TTC Industrial Area, MIDC, Pawne, Navi Mumbai. These imported goods were supplied through M/s Siddarth Logistics Company Private Limited, a unit situated within M/s Arshiya International Limited Free Trade Warehousing Zone (FTWZ). Whenev....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Tribunal, both on merits and on account of time bar. Further, he stated that the appellants have correctly availed the exemption benefit under Notification No. 45/2005-Customs dated 16.05.2005 inasmuch as mere stock transfer of goods from FTWZ to DTA cannot be equated with an exemption from sales tax/VAT. Further, he submitted that applicable VAT/CST have been paid on the final products when these are cleared from their factory, duly supported by invoices produced by them along with certificate issued by the Chartered Accountant. 3.2 Furthermore, learned Counsel also stated that the appellants have made a complete disclosure of facts to the Department, and hence there is no ground of any suppression of facts by the appellants, particularly so when the entire clearances of goods have been undertaken by duly following the procedure prescribed by the Department and upon supervision by the officers of the Department. Further, the appellants had reasonable belief that they are eligible for exemption as the Development Commissioner of SEZ/FTWZ had approved of the same and the FTWZ unit M/s Arshiya International Limited, had assured them of such exemption benefit being available to the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....5.2005 as amended, providing exemption from payment of the whole of SAD in respect of goods cleared from the SEZ/FTWZ unit to the DTA unit of appellants, by way of stock transfer is available or not. 7. We find that the issue involved in this case had been examined by various Co-ordinate Benches of the Tribunal in similar set of facts, and have held therein for extending exemption benefit in favour of the appellants in few cases and have also set aside the orders of the lower authority on time bar aspect also. 8. In the impugned order, the findings recorded by the learned Principal Commissioner is that the appellants are the true and rightful importer of the goods, till it reaches their factory at Pawne, Navi Mumbai. Though the imported goods are cleared through FTWZ unit, since this does not amount to sale and no Sales Tax/VAT is applicable on such clearances, in terms of Notification No.45/2005-Custms dated 16.05.2005, the appellants are liable to pay SAD and they cannot avail the benefit of SAD exemption which has been barred in respect of goods which are exempt from payment of sales tax/VAT. 9.1 In the case of CRI Ltd. (supra), the Co-ordinate Bench of the Tribunal had....
X X X X Extracts X X X X
X X X X Extracts X X X X
....vered by the decision of the division bench of the Tribunal in the case of Serum Institute of India (supra) [refer para 5 & 6]. The decision of the AAR in the case of GE India (supra) also supports the case of the Appellant. We are in complete agreement with the contention of the Appellant that the Circular cannot curtail the scope of an exemption notification which deserves to be interpreted strictly and on its own terms as held by the Hon'ble Supreme Court in the Tata Tele Services case (supra). xxx xxx xxx xxx 8. In the present case, the impugned order itself records at para 12.11 that the subject goods as "ball pen parts" were generally exempted from central excise duty under S. No. 325(ii) of Notification No.12/2012 dated 17 March 2012. Even on the point of limitation the demand has to fail as the BOE's were countersigned by the customs official prior to clearance of goods from the Falta, SEZ. Therefore, the department was aware that the goods were cleared by way of stock transfers not attracting any VAT/Sales Tax. The Notice was issued only after the expiry of the normal period of limitation of 1 year and could not revive the demand, which had got ti....
X X X X Extracts X X X X
X X X X Extracts X X X X
....that the facts of the present case are identical to the case decided by this Tribunal in the case of CRI Limited (supra). The department having been aggrieved by such orders of the Tribunal had preferred appeal before the Hon'ble Supreme Court in Special Leave Appeal (C) Nos. 16739-16794 of 2023. In the said SLP filed by the department, the Hon'ble Supreme Court vide its judgement dated 12.12.2023, had dismissed the SLPs and allowed the department to avail of appellate remedy, if so advised. 10.2 On careful perusal of the impugned order of the learned Commissioner, it is seen that it was recorded therein that the appellants in spite of being well aware that the goods imported by them would be consumed by them and no ST/VAT/CST was required to be paid by them, they still gave misleading undertaking along with certificate from Chartered Accountant to the effect that the imported goods which are used in the goods manufactured by them and cleared under subject Bills of Entry are not exempted from ST/VAT/CST, which clearly shows that they had malafide intention and had clearly mis-declared as well as suppressed the facts. The question of leviability to duty (SAD) or exemption....