Custom, Excise & Service Tax Tribunal
Commr. Of Customs (Prev.), Kolkata vs M/S Nitee Fabrics on 20 December, 2012
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL,
EAST REGIONAL BENCH : KOLKATA
Cus. Appeal No.120/12
Arising out of O/A No.Prev./Cus/01/2012 dated 27.01.2012 passed by Commr. of Customs (Appeals), Kolkata.
For approval and signature:
DR. D. M. MISRA, HONBLE JUDICIAL MEMBER
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 His Lordship wishes to see the fair copy
of the Order? :
4. Whether Order is to be circulated to the Departmental
Authorities? :
Commr. of Customs (Prev.), Kolkata
APPELLANT(S)
VERSUS
M/s Nitee Fabrics
RESPONDENT (S)
APPEARANCE Shri S. Chakraborty, Asstt.Commr. (A.R.) for the Department Shri Sudhir Kr. Mehta, Advocate for the Respondent (s) CORAM:
DR. D. M. MISRA, HONBLE JUDICIAL MEMBER DATE OF HEARING & PRONOUNCEMENT : 20. 12. 2012 ORDER NO.A-6/Kol/2013 Per Dr. D. M. Misra :
This is an appeal filed by the Revenue against the Order-in-Appeal No. Prev./Cus/01/2012 dated 27.01.2012, passed by Commissioner of Customs (Appeals), Kolkata.
2.1 Briefly stated facts of the case are that pursuant to an information that the respondents had violated an actual user condition of silk yarn (Doupion Silk) imported under Bill of Entry No.1203 dated 25.05.2001 against Advance License No0210011917 dated 10.05.2000 & DEEC Book No. A 024320/Cal dated 10.5.2000, 25 packages of the said yarn collectively valued at Rs.15,53,918/- CIF, were placed under seizure by the customs department at Kolkata in Dec.2001. It was the case of the Revenue that the respondent had imported the said silk yarn against the said Advance Licence and DEEC Scheme where under the place of manufacture was shown as 54, 4-IL-Cross, Hosahalli, Vijoy Nagar, Pipe Line, Bangalore, but, on verification, it was found that no such factory did exist in the said address and the said address was reported to be fictitious.
2.2 A show-cause notice was issued to the Appellant on 27th March, 2002, alleging violation of condition of Notification No.30/97-Cus dated 1.4.1997, and proposing confiscation of goods and imposition of penalty. The Joint Commissioner of Customs, Kolkata adjudicated the case and confiscated the said silk yarn under Section 111 (d) and (e) of the Customs Act, 1962 and allowed to be redeemed on payment of redemption fine of Rs.5.00 lakhs under the provisions of Section 125 (1) of the Customs Act, 1962, after payment of appropriate duty under Section 125 (2) of the said Act; also penalty of Rs.1.00 lakh was imposed on the respondent under Section 112 (a) & (b) of the Customs Act, 1962.
2.3 Aggrieved by the said Order, the Respondent filed an appeal before the ld. Commissioner Customs (Appeals). The ld. Commissioner (Appeals) after considering the evidences and submissions, allowed the appeal filed by the Respondent and directed to release of the said goods and refund of the amount deposited . Aggrieved by the said order, the Revenue is in appeal.
3. The ld. A.R. for the Revenue reiterating the grounds of Appeal has submitted that the address for manufacture of finished goods viz. silk fabrics in the DEEC book was declared, as 54, 4-IL-Cross, Hosahalli, Vijoy Nagar, Pipe Line, Bangalore. But, on investigation it was found that the said address was fictitious as reported by the Deputy Commissioner of Customs, Bangalore vide his letter dated 26.11.2001. Further, the ld. A.R. has submitted that during the course of investigation, the Department came across three addresses, from where, the respondents claimed to have been operating during the relevant period. The first address is at No.13, Papanna Lane, Sanjeevappa Lane Cross, 1st Floor, Avenue Road Cross, Bangalore 560002, mentioned in the Challan 6 dated 8.10.2001; the second address is at 54, 4-IL-Cross, Hosahalli, Vijoy Nagar, Pipe Line, Bangalore, where the resultant products for export were declared to be manufactured; and the third address at 12, 6th Cross, Laxmi Road, Shanti Nagar, Bangalore, was given SSI Certificate issued by Director of Industries. All these addresses were found to be fictitious. He has submitted that since the address for the manufacture of imported yarn as declared in the DEEC book was found to be not correct and fictitious, hence, the seized silk yarn were liable for confiscation and hence, the order of the ld. Commissioner (Appeals) is bad in law.
4.1 The ld. Advocate appearing for the Respondent, rebutting the argument of the Ld. AR that the addresses were fictitious, submitted that the address of 13, Papanna Lane, Sanjeevappa Lane Cross, 1st Floor, Avenue Road Cross, Bangalore-560002, was not their factory, but it is their office address, which existed at the relevant time and continued to exist even today; regarding the factory address of 54, 4-IL-Cross, Hosahalli, Vijoy Nagar, Pipe Line, Bangalore, he has submitted that even though this address was shown in the DEEC Book as the place of manufacture, the same was no longer in operation and for manufacture of finished goods, it was Ramsundra Village, Kolar District, Kolar, Kranataka-563101 shown in the Advance License and categorically stated by Shri Tapan Chakrabarty, export manager and Shri Jiten partner of the Appellant intheir statements; regarding the third address i.e. 12, 6th Cross, Laxmi Road, Shanti Nagar, Bangalore, he has submitted that though the said address was shown in their SSI Certificate issued by the Government of Karnataka, but it was their previous office at the time of issuance of the said Certificate on 6th May, 1986, which was later shifted to the address at 13, Papanna Lane, Sanjeevappa Lane Cross, 1st Floor, Avenue Road Cross, Bangalore-560002. He has further mentioned that in the said SSI Certificate issued by Government of Karnataka the factory location was shown at 54, 4-IL-Cross, Hosahalli, Vijoy Nagar, Pipe Line, Bangalore.
4.2 The ld. Advocate submitted that initially on the basis of the report from the Customs Department the Joint Director General of Foreign Trade cancelled their Advance License vide Order No.1230 dated 6th December, 2005, but on an appeal by the respondent, the said Order was set aside by the Appellate Authority vide Order-in-Appeal dated 21st April, 2006, The ld. Advocate submitted that even though the order-in-appeal dated 21.4.2006, was placed before the adjudicating authority, however, the same was not considered, and confiscation was directed. But the said order-in-Appeal was considered by the ld. Commissioner (Appeals) and accordingly, their appeal was allowed by him.
4.3 The ld. Advocate further submitted that though they have mentioned the factory address in the DEEC Book as 54, 4-IL-Cross, Hosahalli, Vijoy Nagar, Pipe Line, Bangalore, but it was not in dispute that due to paucity of space the goods were manufactured at the factory at Ramsundra Village, Kolar District, Kolar, Kranataka-563101 and the necessary evidences of Lease Deed in favour of the Respondent were produced during the course of investigation and was investigated by the department. It is their submission that the finished goods were manufactured and exported by them as per of Advance License at their factory, at Ramsundra Village Kolar District, Karnataka. He has submitted mentioning the old factory address in the DEEC book could not be construed as violation of the conditions of relevant notification when their Advance License/DEEC permission cancelled initially on the said ground later restored by the Appellate of authority of DGFT.
5. Heard both sides and perused the records. I find that the only ground on which the adjudicating authority has directed confiscation of the 25 packages of silk yarn imported against BE No.1203 dated 25.5.2001 under Advance License No0210011917 dated 10.05.2000 & DEEC Book No. A 024320/Cal dated 10.5.2000 is that, the factory address mentioned in the relevant DEEC Book, where the goods were to be manufactured, on investigation, it was noticed that no activity of manufacture was found to be carried out and the report of the jurisdictional authority that the said address was fictitious. It is not dispute that during the course of investigation the export manager as well as the Partner admitted that the exported goods could not be manufactured at the old factory address due to paucity of space and had categorically stated that the goods were manufactured at the Ramsundra Village, Kolar District, Kolar, Kranataka-563101 which was taken on lease and produced the relevant lease deed. I find that the Ld. Commissioner(Appeals), after detailed discussion of these evidences recorded his finding as below:
9. This order of the Addl. DGFT was placed before the lower authority. This has been referred to by the lower authority in the impugned order. Yet the lower authority conveniently ignored this order. Instead, the lower authority went on to confiscate the seized silk yarn solely on the basis that the addressees at Bangalore were fictitious. In this context, I have to state that the lower authority has not at all applied his mind. By ignoring the positive evidence put forth by the appellant, he still confiscated the seized yarn. The lower authority even ignored the various statements that were given by the appellant during the course of investigation. Further, the lower authority even ignored the fact that the application for obtaining advance licences referred to their factory at Kolar. In addition to this, copy of the lease agreement of the Kolar Factory was also given to him, which too was ignored. The lower authority shunned all these evidence which favoured the appellant and went on to decide the case based on an incomplete enquiry report that the addresses at Bangalore were fictitious. When no enquiry has been made at Kolar, then the veracity of this report of the Department is itself doubtful. This is a clear case of non-application of mind and harassment to the appellant. More than 10 years have elapsed since the goods were seized and confiscated and which have been lying with the Department. I find that the order of the lower authority is not at all sustainable on facts since it has been decided on incorrect facts which cannot be sustained. I, therefore, set aside the impugned order of confiscation and imposition of penalty. The 25 packages of silk yarn are to be released to the appellant. So also the pre-deposit made of Rs.1 lakh is to be refunded to the appellant. The lower authority shall do so.
6. I find that the aforesaid finding and the order passed by the ld. Commissioner (Appeals) is reasoned one and deserves to be upheld. Accordingly, the Order of the Ld. Commissioner(Appeals) is upheld and the appeal filed by the Revenue, being devoid of merit, the same is accordingly dismissed.
Dictated and pronounced in the open Court.
Sd/
(DR. D.M. MISRA) JUDICIAL MEMBER
mm
2
Cus. Appeal No.120/12