Custom, Excise & Service Tax Tribunal
Dcw Limited vs Commissioner Of Customs, Tuticorin on 16 March, 2009
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No.C/85/2007
[Arising out of Order-in-Original No.258/2006 dated 30.11.2006 passed by the Commissioner of Customs, Tuticorin]
For approval and signature:
Honble Ms.JYOTI BALASUNDARAM, Vice-President
Honble Mr. P.KARTHIKEYAN, Member (Technical)
1. Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? :
2. Whether it should be released under Rule 27 of the
CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? :
3. Whether the Members wish to see the fair copy of
the Order? :
4. Whether Order is to be circulated to the Departmental
Authorities? :
DCW Limited
Appellant/s
Versus
Commissioner of Customs, Tuticorin
Respondent/s
Appearance :
Shri Naresh S.Thackor, Advocate Shri M.K.A.K.Mohiddin, JDR For the Appellant/s For the Respondent/s CORAM:
Honble Ms.Jyoti Balasundaram, Vice-President Honble Mr. P. Karthikeyan, Member (Technical) Date of hearing : 16.3.2009 Date of decision : 16.3.2009 Final Order No.____________ Per Jyoti Balasundaram The appellants herein imported 2250 MTs of Vinyl Chloride Monomer during April 2004 and cleared the goods without payment of duty by utilizing credits under 9 DEPB licences said to have been issued by the Additional Director General of Foreign Trade (ADGFT), Kanpur under Exemption Notification No.45/2002-Cus. dt. 22.4.2002. They had purchased the licences from DEPB broker R.Somanathan & Co., Tuticorin. It was found that the licences were fake/forged as they were not issued by the concerned authorities. Hence a show-cause notice was issued to the appellants proposing confiscation of the imported goods, proposing recovery of duty of Rs.95,29,591/- together with interest and proposing imposition of penalty upon the importers. The notice was adjudicated by the Commissioner of Customs, who confirmed the duty demand under the proviso to Section 28 (1) together with interest under Section 28AB and also imposed a penalty of Rs.50,000/- under Section 112 (a) of the Customs Act. Hence this appeal.
2. We have heard both sides. We find that the appeal can be disposed of on the short ground of limitation. The demand has been confirmed under the proviso to section 28 (1) against the importers who are transferees of the licences. The demand can be sustained only if it is established that the transferees had knowledge that the licences purchased by them were fake/forged; that the importers were guilty of any suppression or wilful misstatment of facts with intention to evade payment of duty or they were guilty of collusion, in the light of decision of the Larger Bench of the Tribunal in Hico Enterprises Vs CC Mumbai, 2005 (189) ELT 135 (Tri.-LB) which has been followed in Aaflot Textiles (India) Ltd. Vs CC,, 2006 (201) ELT 39 (Tri.-Mumbai) and Zenith Ltd. & Ors. Vs CC Mumbai, 2006 (73) RLT 77 (CESTAT-Mum.) and the decision of the Honble Bombay High Court in Taparia Overseas (P) Ltd. Vs Union of India, 2003 (161) ELT 47 (Bom.) and the Honble Punjab and Haryana High Court in Commissioner of Customs Vs Leader Valves Ltd., 2007 (218) ELT 349 (P&H) and CC Vs Vallabh Design Products, 2007 (219) ELT 73 (P&H). Although the Commissioner has recorded a finding in para 5.22 of the impugned order that the importers had colluded with broker M/s.Somanathan & Co. in obtaining fake DEPB licences. We find that there was no such allegation in the SCN and further the finding of collusion also cannot be sustained for the reason that the Commissioner holds that the importers had not taken necessary precaution including conducting proper verification of the DEPB scrips etc., which, certainly, cannot be held to amount to collusion with the broker. There is not even a whisper that the importer had reason to believe that the licences purchased from the broker were fake/forged. In these circumstances, the extended period of limitation is not attracted against the appellants. We, therefore, set aside the impugned order on the ground of limitation and allow the appeal.
(Operative part of the order was
pronounced in open court on 16.3.2009)
(P.KARTHIKEYAN) (JYOTI BALASUNDARAM)
MEMBER (T) VICE-PRESIDENT
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