CENTRAL EXCISE SECTION

Manish Sharma Vs CCE

CX - Penalty - M/s Adarsh industries was issued private bonded warehouse license for manufacture of grey knitted fabrics out of POY/PFY - DRI investigated allegations that M/s Adarsh diverted the duty free materials procured by them against CT-3 certificates into domestic market with sole intention to evade Central excise duty and take undue advantage of concessions provided to 100% EOUs for export promotion - M/s G N Rubber was a dummy unit set up in benami names by Sh. Mohammed Anwar - It had no capability for undertaking any manufacture but showed fictitious procurement of goods from M/s Adarsh thereby facilitating and abetting the illicit removal of goods by them - Sh. Puneet Rugta has admitted in his statements that he was associated with Sh. Mohammed Anwar in legitimizing the financial transactions between M/s Adarsh and M/s G N Rubber - He also facilitated the fake sales of raw materials shown in the books of M/s GN rubber - Sh. Munish Sharma is also a close associate of Sh. Puneet Rugta - He has admitted to signing the fraudulent sale contracts on behalf of M/s GN Rubber with M/s Adarsh - Since their active participation in evasion of duty stands established, no reason found to interfere with penalties imposed on all the persons, same are accordingly upheld: CESTAT - Appeals dismissed: DEHI CESTAT

2018-TIOL-271-CESTAT-CHD

Saurav Chemicals Ltd Vs CCE

CX - Assessee engaged in the manufacture of excisable goods and claimed rebate of Homatropine Methyl Bromide and Homatropine Hydro Bromide - These compounds were chargeable to nil rate of duty under Notfn. No. 04/06 - However the assessee treated both of them as excisable & cleared them to the domestic market on payment of duty and for export on payment of duty under rebate claim or against LUT or CT-1 certificate for supplies to 100% EOU - the revenue felt that the duty paid on the clearance of these two compounds cannot be treated as duty u/s 3 of the Act, as u/s 5A(1) a manufacturer was not to pay excise duty on goods on which exempted had already been granted - Demand was raised for recovery of 10% or 5% of the value of the exempted goods for non-maintenance of separate accounts of exempted and dutiable goods - Another demand was raised for recovery of Cenvat credit availed during manufacture of exempted goods - Both demands were accompanied by penalty & were upheld by the Commr.(A) - Considering the findings of the Himachal Pradesh High Court in Drish Shoes Ltd. 2010-TIOL-350-HC-HP-CX , the goods supplied against CT-1 to EOU are specified in exception to Rule 6(6) of the CCR, 2004 - Hence the findings of the Commr.(A) in this regard are upheld - The Tribunal in Castleton Tea Co. 2016-TIOL-1460-CESTAT-KOL covers the issue of whether duty paid on unconditionally exempted goods and rebate claimed thereafter was covered under Rule 6(6)(v) of CCR, 2004 - Following the same, the assessee is required to pay an amount equivalent to 10% on value of exempted goods - The assessee claimed to have paid back the amount of rebate received by them in cash - Such fact would require verification by the adjudicating authority & the amount paid back in cash may be adjusted against 10% of value of exempted goods - As for the goods cleared under domestic sales in two transactions, the amount of duty paid shall amount to the reversal of Cenvat credit on the inputs as held by this Tribunal in the assessee's own case - Both appeals so disposed off: CESTAT - Appeals partly allowed: CHANDIGARH CESTAT

2018-TIOL-270-CESTAT-KOL

CCE, C & ST Vs Jai Jagannath Steel And Power Ltd

CX - Assessee engaged in manufacture of Sponge Iron - Adjudicating Authority disallowed the CENVAT Credit on various Iron & Steel items - By impugned order, Commissioner (A) set aside the adjudication order - Revenue in their grounds of appeal stated that items in question were used in supporting structures of capital goods which are permanently attached to the earth - The assessee stated before the Adjudicating Authority that the items were used for fabricating / manufacturing the steel structures such as kiln, intel house, kiln cooler transfer house, raw-material and stock house - On identical issue, Tribunal in the case of S.P.S. Steel & Power Ltd, dismissed the appeal filed by Revenue - In view of the same, appeal filed by Revenue is rejected: CESTAT - Appeal rejected: KOLKATA CESTAT

CUSTOMS SECTION

NOTIFICATION

dgft17not045

Export Policy of Onions- Imposition of Minimum Export Price (MEP)

CASE LAWS

Pramod Kumar Vs CC

Cus - Assessee imported Speed Post Parcel at Foreign Post Office (FPO) - The goods were containing the declaration of "Artificial Gift Item" - The Customs Officers after examining the goods, found that the parcel contained "unbranded Micro SD Cards" of various storage capacities - Assessee had classified the imported goods i.e. "unbranded Micro SD Cards" under CTH 85235220, providing for 'Nil' rate of Basic Customs Duty - However, adjudicating authority had classified the subject goods under CTH 85235100, which attract 10% Basic Customs Duty - For arriving at the classification issue, adjudicating authority has referred to CBEC Circular No. 12/2002 - Goods of Tariff Item No. 8523 are exempted from payment of Basic Customs Duty under Notfn 24/2005-Cus. as amended - Further, CBEC vide Circular dated 20.07.2016 has also clarified that the benefit of said notification is extendable to Micro/Mini SD cards classified under CTH 85235100 - Thus, it is apparent that change in classification of subject goods by Department will not create any additional Basic Customs Duty liability for assessee - Therefore, assessee is not liable to pay Basic Customs Duty on imported goods, even under the classification made by the Department, which was different than the classification made by it.

So far as the issue of confiscation of impugned goods is concerned, provisions of clause (m) of Section 111 ibid is attracted, inasmuch as, the value and declaration of goods made in post parcel do not correspond to actual goods imported by assessee - Thus, confiscation of goods and imposition of redemption fine in the impugned order is sustainable under the law - However, inasmuch as, the assessee had not made any false declaration with regard to actual content in parcel, filed proper documents for assessment of Bill of Entry, paid applicable duty - Therefore, quantum of redemption fine is reduced to Rs.20,00,000/-.

So far as imposition of penalty under Section 112 and 114 AA of the Act is concerned, the same are not dependant on the provisions of deeming fiction under Section 82 of the Act - Department has not brought on any evidence to prove assessee's guilt in mis-declaring the goods - Rather, submissions of assessee has been completely ignored and brushed aside by original authority - Thus, in absence of any specific substantiation regarding the involvement of assessee in fraudulent activities like mis-declaration, imposition of penalty, will not stand for judicial scrutiny - Accordingly, penalty imposed on assessee is set aside: CESTAT - Appeal partly allowed: DELHI CESTAT