Karnataka High Court
Commissioner Of Central Excise vs M/S Decorative Laminates (I) Pvt Ltd on 15 April, 2010
Bench: K.L.Manjunath, B.V.Nagarathna
IN THE HIGH COURT 01? KARNATAKA AT I3ANGA:,QRE
DATED THIS THE 15th DAY OF APRH{,A%2"'é%::;?j%'»¥;-«
PRESENT
THE HON'BLE MR.JUS'fiCE' :«:_.
THE HONBLE MRS, %
C.S.T.A.N(j::.i6/2606'.
Commissioner of Cezngrai Exfiisge, ;A ..
Mysore II Division, _' _ '
S1 85 S2, \'i:1;¢yA'%?:i:s,:,¢;f;'%:a,€: "
"
Mysore~5'7_Q :31»: ' .. " APPELLANT
{By , Counsel for
Sri.NB1;aska;'.'fQr'Ta;;5p.¢i1§}nt)
AND:
M. I1){§:cQrafi{ié'La.rn'inates
' Y¢i'esraivR'(:s.a'd,_Bgiavadi,
Iariy_$o£i:»E}?_1~ 186 . . . RESPONDENT
sri;.V:T.I'2E;ajeswara Sastri, cmmscl for 'F.Ra_}eswara
" SastI*i_Aé3sts fer respondent)
This CSTA is filed 11/ 3 138 of the Customs Act,
7196': praying to set aside the order passed by tbs
CEESTAT iii Appeal 1510.328 & 329/2093 'wide the Firlai
"order N<:>.1698 & 1599/05 dated 30.9.2005 and
B:/iisc.GI'dcr Nos.34 & 35 dated 13.1.2006.
THIS APPEAL COMENG QN FOR EEARING THIS
DAY, NAGARATHNA J, DELIVEREQ THE FOLLOWENG:
1?
,.r
: AGARA'i;'I?INA ' x _
JUDGMENT
This appeal is filed by the revenue by the order (it. 30.9.2005 passed in Appca; 329/2003 vide, its final Ox'der_No_$. 1a9s~g.; 1A699'/05%' and order dt.13. 1.2006 passed an M:s¢.Grde:L"+AN§s§%;3<i*3; 35/2006 by raising '(ha qfle$t%0§i$!<jf'..;Iaw:
1) Whether the TI'jTbuna}V.=::as~.19ight i11"its..vie'w in the ixtterpretation Sccf: 2:3("i*}.__9_f'=1;he custems Act, 1961 and holdi11g'i:11at.th§,- (_:0ncEitions was therein were fulfilled? .... '
ii) Whethéir was "right in its View in hoIdif1g'_'«.that'_V_ t:hc,j~ the authorities was based.' 03:1 gjcveime
iii) Whether 'E'.:fib!_;ti'1al was right in holding that there _is' -nd€l11'11g',.._"i1i the law which says that remission {ref clugf' is not permissible when the ; ' r::missien'appIit:ation is filed after the expiry of the " v;g§1*ehousfi1g..;:»sriod?
L' the Tribunal was right in hoidirig under __ . t:it'16»<;:iI"ai};1xi1star;<:es, demanding duty on destroyed A ' goqé:-:sT__befo1*e clearing from the warehouse would be very harsh. Which is contrary to the ratio in thé: case of Sialkot Industrial Corporation, Meemt A. VS. Union of India & Another reported in 1979 (1329), the duty should be remitted on the goods which have been Inst?
2. The facts of the case according tn the I'€.'¥6I1¥_1€ are that the resp0ndent-assesses W123 is holder of a fiivate Bonded Warehouse Licenm issued under the .9 3 provisions of the Customs Act is a manufacturer of furniture and had the license for storage of raw materials, namely, resin Impregnated _ wood used for manufacture of Laminated. .. That the respondent had :' ('}'f resin and impregnated paper shed * in the warehouse by eone ttr§$¢.32_/2005se:.k;n3.7.2ooo. The respondent of the said bond npte" that the goods wegfe eenld not be used for man;;facm:}¢n%% in the market and the extension'. was " :'T:1'1e1eaiter another application was made" 337. by contending that the resin V' . pe_pie'r'£?hieh were stored in the ware house :tsVA's.etgeif life and had become unfit for use on aeeeunt n0n--avaiIabi1ity ef orders for clearance and ._ A' xaeee1"dingly an applieatien for remission ef duty was A' --..V:n:-zeie. The request for remission of duty was rejected ....--eiz1<:e the bond was extended upto 33.12.2003 and there was no provision for such remission of duty dxxring the period of such extention. The respondent M' 1*] "
4
was directed to deposit duty along with interest by letter dt. 1.2.2002, to which the respondent had contending that show cause 'notice has to Thereafter Show cause notice _Jdt.,\l§s.s ' issued to the respondent cla1'mii1g penalty. Since remission 11ed__ the V L' said notice was replied. to ftlereafter the matter was adjudtosted in-original was passed on penalty along with ixxterese ~ v'_'e'y; .the said order, the respondent" appeal before the Cfommtssioner (Appeals), Bangalore, which was dismissed' on 1.7.2003. The said matter was before the CESTAT, which by its order the appeal. Thereafter, an which was filed for tyeogephieal error was Vt allowed by order dt.13.1.2{)O6. Being aggieved by orders, this appeal has been preferred by the 9;
V w:'eve:eue.
3. We have heard the leameci Counsel fgr the appellant and learned counsel for the re$p9:';_r~1'¢"{c=;):I;- 5188638866.
4. It is contended on behalfof. ' ~ the instant case, at the pew d3.II'ing the extension of gr21I1_ by Vév!VitI1OV£i1ies'," V the respondent~assessee _;:leaIt" 'theigoods by paying the requisite other hand, it had made_a:§:. V r&;n 1ission of duty by invoking Act after the lapse of the I that the authorities were just:$f1éd-. 1°i<i1*:-- {I16 said application as the asseésae 1f1acEiA.1::V<V)t made out a case under section 23 of 'f zé{;%:?, therefore the Tribunal could not have E0 the assessee by holding that the destroyed before they were cleared for home " "wnsiiiifipfion by applying Sacticn 23 of the said Act. has also: draw/H cur attaniicn to Sectians ?I and '?2 V' 'L-sf the Act and relied upon a decisien of the Bombay High com reported in 2903 (155) BLT 25 (B0131) in the EV 6 Case of VIDEOCON INTERNATIONAL LIMITED. VS. UNION OF INBLA it: support of his submission.
5. Per contra, ieamed ceunsei for the~.aeseesee..A would submit that on account of the > were stated in the appiieation for;'see1§i1;,g"":eii1ie.?3i0m..e under section 23 of the Act,' the {fie L. warehouse at the time of '- and that at no point of reeeoeed and that during thfi. were in the warehouse. ' 'V therefere the pr0vis;1ee:_e_f'A seeeeely appficable and that the a1!ifi;'1(i1'ities... right in rejecting the §ipp}§;C{i§i.QI3 teday the goods are not being the warehouse and therefore under the L"C.ire:L_1m'st§eneeeementioned in section 23 cut" the Act, the V . 1T'€Si§(1I1dVi6f1i'iS entitled to remission of duty. He has also a decision of this Court in the case 01"
::::ee1vmIss10NER 012' CUSTOMS vs. 12 * *§EeHNOLeGIes SOFTWARE PRIVATE we reperted in 203'? (21?) BL'? 17% (K3?) in support of his submissien. :3 2/
6. Having heard the counsel on both sides eggd on perusal of the materia} on record, the oniy has to be answered is as to whether aseessee is entitled to remissiontof «s_eo.'23 of the Customs Act.
7. Section 23 of the Customs Act afeéfoilows:
"Section 23. Remiseian ofdutyfé mi-lost, destroyed or abandoned g0ods.-- " t ._ ; .. ' (1) Without prejudice to the pr0§Jisio:i_s of section 13, where it is to,'T11e'. $f:isfaet;ioz1 of the Assistalit_1'CoI}1miseione19' of ..c7§1stoms 02' Deputy Commisejo11er.,CL1etoms. that any imported goods .:-have"heeri'.'j1ost..ethe1wise than as a result pt1rerag=;¢t_ ;>_1f".;ieS£1?oyfed, at any time before cIea1'3in_ee 1fo1'.ho1fne consumption, the Assistant '...'Co1:"1131ise:i'o:ier of' ' Customs or Deputy (T',omm1e_s:o:f1er"~oI"'»fi5t1stoms shall remit the duty efieueh goods; , ._':"{Q)f;'i1e owrier----.--ef' any imported goods may at any "'ti;n1e'«.befere an order for clearance of goods fer "--hOIfle_eensumptien under section 47 or an order "'for,,_ petinitting the deposit of goods in a warefxouse under section 60 has been made, = «reli:'iq11ish his title to the goods and thezeupon " _h:e shall not be liable to pay the duty thereon.
Vt-V V. Provided that the owner of any such imported goods: shall not be allowed to relinquish his title to sueh geods regarding which an offence apwars to have been '"com1:t1it'£ed under this Act er any other law for the time wing in force."
8. From the material on records, it is not in dispute that the respondent had impoltedf materials for the purpose of 1?.{1.az111fact1u'e{of and that the said goods were date of its import. it is also notiiin: €iis'pute';iist. gems have not been by paying the requisite ~.__customs{'; 'However, the extension sought for was granted by £he:'A.;g§1tho;'ities': the expiry of the said removed from the warehouseix the Act states that oniy when the lost or destroyed at any "before "clearance for home consumption, the i.Aa?p;Vjj1iceiioI'§:for_ remission of duty can be considereci and an order for clearance of goods for
--V he1fie..consfimption is made, relixiquishixig of titie to the 'A .,goo-(ins be made, ix'; such event else an importer net be iiable ta pay duty. Therefere the " 'expression "at: any time before eimranee for home eensumptien" weuid mean the time period as p61' the initial endear during which the gmds are were housed er Q. 5/";
9 before the expiry of the extended date for ciearance and no'; any period after the lapse of the afere The said expression cazmot extend to a lapse of the extended period merely' beeause.1:ii;!1e"V1iCenee " " 2 holder has not cleared the godds time.
9 Having reaganj. to 1 emsient case, wherein even duxirrg' the goods were not cleared_ and the fact that si.nc:e" :W_€;_I*¢5§ ::§}(}iZ_ removed for home cons{1em§'tieri ""11';ei:3f" e'drr§i12ued to be in the Warehouse, even after_t¥1e "the warehousing period, it would hnpreperly gemoveé. from the ' " """ " ,-£1 ' §v2reh.r§i1se.i a3___per section 72 (mg) read; with section '2'}. H ihex: have to hold that in the irlstant ease, the eireuflieterlces made out under section 23 of the V' '(f Céietome Act are net applicable to the present case eince the fiestruction 0f the jgooés or lease of the geods has not occurred in the instant ease befere the ciearance far heme eensumptien within the meaning of that sectien. When the goods are :10: eIea1"ed Wifhifi the 2%».-:.