Even if Revenue pleas are accepted that appellant has entered into unwanted high sea sales, fact is that appellant has got exemption & benefit of notification cannot be denied - Stay granted: CESTAT
By TIOL News Service
AHMEDABAD, JUNE 17, 2013: THE appellant has been denied the benefit of Notification 1/2011-Cus dated 06/01/2011 and a duty of Rs.1,55,10,142/- has been demanded from him. Penalty of Rs.50 lakhs has also been imposed on the appellant and a penalty of Rs.25 lakhs has been imposed on co-noticees.
All of them are before the CESTAT with Stay applications.
The appellant submitted that the notification exempts the Customs Duty in excess of 5% if the goods are used for initial setting of solar power generation project or facility; that that the appellant had filed a Bill of Entry with the authorities for clearance of the said equipment along with a certificate given by Ministry of New and Renewable Energy; that the entire findings of the adjudicating authority are revolving around irrelevant question inasmuch as the adjudicating authority has mis-directed himself as to whether the high sea sales agreement entered by the appellant with other companies are real and genuine and whether the certificate issued would be vitiated due to such an agreement; that the appellant has held himself as an owner as well as importer and is covered by the definition of importer under Section 2(26) of Customs Act, 1962.
The Revenue representative submitted that the original contract was entered by the appellant with M/s Photon Energy Systems Ltd and M/s Megha Engineering & Infrastructure Ltd. It is his submission the appellant has not owned the goods which were imported and has filed Bill of Entry and hence cannot be considered as owner for import. He would submit that the entire contract entered by M/s Megha Engg. & Infrastructure Ltd and M/s Photon Energy Systems Ltd would indicate that there was something wrong and the appellant, having not paid for the goods, cannot be held as importer. It is his submission that the findings of the adjudicating authority are very clear in as much as the officials of all the 3 units viz. M/s APCA Power Pvt. Ltd. with M/s Photon Energy Systems Ltd and M/s Megha Engineering & Infrastructure Ltd. have accepted that the agreement was only for the purpose of documenting the sale of goods before the goods land in India.
The Bench observed -
“4. On careful consideration of the submissions made by both sides and perusal of the records, we find that the issue involved in this case is regarding the differential duty of Customs which has been confirmed by the adjudicating authority by denying the benefit of Notification No.1/2011-Cus. We find that there is no dispute as to the fact that the goods which were imported, benefit of Notification No.1/2011-Cus, was claimed in respect of solar power generation project or facility for solar energy plant to be set up in Gujarat. It is also undisputed that M/s APCA Power Pvt. Ltd. was project promoter/ developer and has applied for said certificate with Govt. of India Ministry of New and Renewable Energy. Their application was entertained by Govt. of India, Ministry of New and Renewable Energy and approximate certificate was issued to them extending the benefit of Notification No.1/2011-Cus, which accept and acknowledges the fact that the goods are needed for solar power generation project or facility. If that be the case, the benefit of Notification No.1/2011-Cus, cannot be denied to such goods.
5. Yet another angle to the entire issue is whether the appellant M/s APCA Power Pvt. Ltd., having filed Bill of Entry, can be considered as an importer or not. We find that the definition of 'importer' under Section 2(26) of reads as under:
"'Importer', in relation to any goods at any time between their importation and the time when they are cleared for home consumption, includes any owner or any person holding himself out to be the importer"
It can be seen from the above definition that the appellant can be considered as a person who is holding himself out to be an importer, even if all the arguments of the Revenue are accepted that the appellant has entered into various unwanted agreements of high sea sale.”
Holding that the appellant has made out a strong prima facie case for waiver of pre-deposit of the amount of duty, interest thereof and the penalty imposed, the Bench granted a stay in the matter. The Bench also observed that since it has held that the goods are prima facie eligible for benefit of Notification No.1/2011-Cus, the confiscation ordered by the adjudicating authority is, prima facie , erroneous.
(See 2013-TIOL-912-CESTAT-AHM)
