Customs, Excise and Gold Tribunal - Mumbai
D.K. Polyn Industries, Mahendrakumar ... vs Commissioner Of Customs And Central ... on 4 September, 2001
ORDER J.H. Joglekar, Member (T)
1. These four application relate to four appeals filed against a common order passed by the Commissioner. These are therefore taken up together for disposal.
2. M/s. D.K.Polyn Industries are manufacture in 100% Export Oriented (EOU) sector, Shri Kapadia is the partner and S/Shri Shah and Slavi are persons who had purchased certain goods from it.
3. On checking of stock of yarn in the EOU unit shortages of processed yarn of over 1 lakh kilogram was noticed. The partner of the unit Shri Kapadia accepted that these goods were sold by them for cash without the cover of invoices and without discharging the burden of duty. The two traders accepted purchase of these goods. After issuing show cause notice and after hearing the concerned persons, the Commissioner confirmed the customs duty amounting to Rs.61,12,328/- against the unit and also imposed penalty of equal amount on them. He imposed penalty of Rs.10 lakhs on Shri Kapadia under Section 112(b) of Customs Act, 1962 and of Rs.1 lakh each on the two traders under the same provision. Hence these four appeals and present applications seeking waiver of pre-deposit of duty confirmed and penalties imposed.
4. Shri Willingdon Christian, learned counsel for the applicants submits that what is payable by an EOU for clearance in the domestic tariff area (DTA) are duties of excise paid as a percentage of the duty of customs that is attracted. He refers to a number of judgments claiming this including the larger bench decisions of the Tribunal reported in 2000 (40) RLT 205 (Vikram Ispat & Ors Vs. CC, Mumbai-II). He also shows us the case law relied upon by the Commissioner and submits that the case law is not relevant.
5. We have seen the text of the notifications 55/91-CE and 25/98-CE which permits clearance of goods sold in the DTA by an EOU unit at concessional rates of duty of excise. These notification read with the judgment make it clear that what was attracted in this case was duties of excise and not of customs. Prima facie, therefore the levy of penalty also seems to be without any basis of law. We therefore grant the prayer made for waiver of pre-deposit of duty and penalties imposed and also stay their recovery during the pendency of these four appeals.