Customs, Excise and Gold Tribunal - Mumbai
Goyal Fibres Pvt. Ltd. And Others vs Commissioner Of Customs And Central ... on 15 June, 2001
Equivalent citations: 2001(138)ELT1013(TRI-MUMBAI)
ORDER Gowri Shankar, Member (T)
1. Applications are for waiver of deposit of duty, penalties and fine for redemption of confiscation of plant, building and machinery as detailed in the annexure. Vimla Fashion Pvt. Ltd., Bijaykumar D. Agarwal and Shiva Exports are absent and unrepresented, and requested fro adjournment on the ground that their advocate has to attend Court at Navsari. No vakalatnama has been filed. Copy of some railway ticket is enclosed but this does not contain anyone's name. We therefore declined to adjourn.
2. The delay of 20 days in filing the appeal of Radhey Shaym Garg is condoned.
3. We are concerned in these applications with the scope of the exemption contained in notification 34/94 to textured yarn manufactured out of filament yarn imported under the duty exemption scheme of the 1992-97 Policy, which is subject to the condition that it is proved to the satisfaction of the Assistant Collector that the textured yarn is to be exported or used in the manufacture of any other goods which are to be exported. Shiva Exports and Vimla Fashion Pvt. Ltd. imported filament yarn under the duty exemption scheme and passed it on to the other applicant, who are job workers, for texturing the yarn. These applicants textured the yarn and cleared it without payment of duty in terms of the exemption and claim to have returned it to Shivam Exports and Vimla Fashion Pvt. Ltd. The order of the Commissioner adjudicating upon the notice alleges that the textured yarn was neither exported nor used in the manufacture of any other commodity which was exported, and proceeds to demand duty from the job workers, and impose penalty on them and on the importers of the yarn.
4. The failure to export is not denied by the counsel before us. They however, claim that the department itself has ruled that duty in such cases is to be recovered from the importer who fails export the yarn. The Trade Notice 78/94 issued by the Collector of Central Excise, Surat purports to specify the procedure devised for proper implementation of the notification. It requires the following procedure to be followed. The importer of the yarn executes a bond, bank guarantee or legal undertaking binding himself to pay the excise duty on the quantity of textured yarn not utilised for export. He is required to inform the Assistant Collector having jurisdiction over him of receipt of the filament yarn and required maintain records of the movement of the yarn. He is also required to undertake to advise the Assistant Collector having jurisdiction over the person carrying out the texturing of the discharge of the yarn to that manufacturer. The person who textures the yarn will also keep records. The exporter must submit the proof of export within six months of the date of import.
5. It is the contention of the counsel that by this procedure, the department itself recognises that the duty on the textured yarn has to be paid, not by the processor but by the importer and exporter of the yarn. The trade notice itself says this to be the case. It does not require that the processor shall pay the duty, or purport to recover the duty from the exporter only in the event that the processor does not pay duty. However, we are not able to perceive any provision of law whereby the Commissioner is authorised to transfer the burden of the excise duty from the manufacturer of goods who is required to pay the duty to anyone else. Prima facie therefore this trade notice, insofar as it to relates to recovery of duty, is a nullity in law.
6. The other argument that is advanced is that the extended period contained in the proviso under sub-section (2) of Sec. 11A of the Act, which has been invoked in the notice by alleging suppression of the failure to export the yarn, will not be available. Each of the applicants received the yarn from the importer showing evidence of this clearance under the duty exemption scheme. They ceased to be the concerned with the yarn thereafter. They ere therefore not in a position to know, and in fact did not know whether the yarn was exported or not. There is therefore no suppression of facts by them.
7. While the departmental representative reiterates the Commissioner's order, this does not really help. Unless it is shown that the job workers knew or had reason to believe that the yarn wold not be exported, the fact that it was not exported would not prima facie by itself be enough to invoke the extended period in demanding duty from them. We accordingly waive deposit of the duty demanded and penalties imposed on these processors and their partners and employees.
8. Penalty has been imposed under Rule 209A on Shivam Exports and Vimla Fashion Pvt. Ltd. for their failure to export the yarn. The contentions in their stay applications are common. it is that they never supplied the yarn. They suggest, without saying so categorically that the yarn that they imported was not supplied to the processor for texturing. There is a further contention that the processed yarn was not received back. These contentions are mutually contradictory. The processors all accept that they received the yarn from these persons. There is no dispute that they filed the prescribed in the trade notice and various intimations have been furnished by these parties. The claim int he applications that the signature of an employee of Shivam Exports was forged, to show supply of yarn by it is, prima facie, wholly without substantiation. There is an attempt to say that Gajanand Agarwal, director of Kusum Synthetics Pvt. Ltd. was responsible for supply of the yarn. However, it is not explained how Agarwal could obtain possession of the yarn without the consent of the applicants. The claim that the applicant suffered losses due to earthquake is also unsubstantiated.
9. Having regard to these facts, and what appears to be a clear conspiracy not to pay duty on the yarn, we consider it appropriate to ask for deposit of penalties imposed of Rs. 3 lakhs each on Shivam Exports and Vimla Fashion Pvt. Ltd. and Rs. 1 lakh on Bijaykumar Agarwal, director of the one and partner in another. Such deposit is to be made within a month from the receipt of this order.
10. Compliance on 23rd August, 2001.
Annexure
Duty (Rs.) Penalty (Rs.) Fine (Rs.)
Goyal Fibres Pvt. Ltd. 14,35,220/- 14,35,220/- 30,000/-
Goyal Synthetics Pvt. Ltd. 9,56,816/- 9,56,816/- 30,000/-
Goyal Texturisers 9,37,681/- 9,37,681/- 30,000/-
Rajendra Prasad Ramkumar Goyal - 3,35,000/- -
Divya Texturising P. Ltd. 6,16,490/- 6,16,490/- 20,000/-
Nandkishore V. Sharma - 60,000/-
Kusum Synthetics Pv.t Ltd. 25,96,905/- 25,96,905/- 60,000/-
Gajanand Surajbhai Agarwal - 2,60,000/- -
Swati Polyesters 20,73,644/- 20,73,644/- 50,000/-
Suresh Agarwal - 2,05,000/- -
Gedeelon Texo Twist Pvt. Ltd. 6,68,684/- 6,68,684/- 20,000/-
Arunkumar G. Agarwal - 70,000/- -
Rawalwasha Textile Inds. P. Ltd. 13,36,340/- 13,36,340/- 35,000/-
Sudeshkumar Agarwal 1,35,000/-
Vineet Texo Twist P. Ltd. 12,48,954/- 12,48,954/- 34,000/-
Sanjay Omprakash Agarwal - 1,25,000/- -
Kay Bee Lon Texturisers 3,56,183/- 3,56,183/- 10,000/-
Rameshbhai Bhailalbhai Shah - 35,000/- -
Ruchi Synthetics Pvt. Ltd. 10,53,326/- 1053,326/- 30,000/-
Atambhai R. Juneja - 1,05,000/- -
Saraswati Tex-O-Fab Ltd. 18,95,720/- 18,95,720/- 46,000/-
Sharad R. Gupta - 1,90,000/- -
Urvashi Fibres P. Ltd. 5,34,948/- 5,34,948/- 18,000/-
Madanlal B. Agarwal - 50,000/- -
Vimla Fashion Pvt. Ltd. 3,00,000/- -
Bijaykumar D. Agarwal 1,00,000/- -
Shiv Exports - 3,00,000/- -
Suyog Fibre India Pvt. Ltd. 8,12,445/- 8,12,445/- 24,000/-
Radhey Shyam Garg 81,000/-