Custom, Excise & Service Tax Tribunal
M/S J.S.Designer Ltd vs Cc(Icd), New Delhi on 20 December, 2011
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Block No. 2, R.K. Puram, NEW DELHI COURT No. III Misc. Application No.804 of 2011 Customs Appeal No.571 of 2011 [Arising out of Order-In-Original No.31/2011, dated 08.09.2011 issued by CC(ICD), New Delhi] Date of Hearing : 25.10.2011. For approval and signature: Honble Ms. Archana Wadhwa, Judicial Member Honble Mr. Rakesh Kumar, Technical 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 Their Lordships wish to see the fair copy of the Order? 4 Whether Order is to be circulated to the Departmental authorities? M/s J.S.Designer Ltd. Appellant Versus CC(ICD), New Delhi Respondent
Coram: Honble Ms. Archana Wadhwa, Judicial Member Honble Mr. Rakesh Kumar, Technical Member Present for the Appellant Shri Pradeep Jain, Advocate Present for Respondent Shri Amrish Jain, SDR Order No._______________ Dated :___________ Per Ms. Archana Wadhwa:
Present impugned order stands passed by Commissioner under the directions of Honble High Court of Delhi issued vide order dated 16.08.11 passed on the writ petition filed by the appellant.
2. As per the facts on record the appellant is a Govt. approved export house working for the last 11 years. They have filed three shipping bills at ICD, Patparganj, Delhi for export of fabrics totally valued at about Rs.9.25 crores. As the Revenue entertained a doubt about the correct value of the said fabrics as reflected in the shipping bills, investigations were started. However, subsequently the said three consignments were permitted to be exported on execution of bond with bank guarantee of Rs. 2 crores furnished on 17.06.11.
3. Subsequently another shipping bill was filed by the appellant on 15.06.11, which was also detained for investigation. Vide letter dated 11.07.11, the goods were allowed to be released provisionally on execution of bond for a value equal to 100% of the value declared in the shipping bill with bank guarantee equal to 25% of the bond amount. The appellant filed a representation requesting for waiver of condition of bank guarantee, relying upon a letter dtd. 14.06.11 issued by Deputy Commissioner, Export (SIIB), ICD, Tughlakabad, New Delhi, addressed to the Deputy Commissioner, Export Shed, conveying the decision of the competent authority to the effect that in all cases where goods are not seized/confiscated, the same may be cleared provisionally with the rider that benefits to the exporters may not be released till finalization of investigation. The letter further mentions that bond equal to the value of goods with adequate bank guarantee as may be determined by the proper officer, may be obtained from the exporters for provisional release of the goods.
4. The appellants also made another representation on 19.08.11 praying for waiving the conditions of bank guarantee as also claiming the release of bank guarantee of Rs. 2 crores given by the them at the time of release of goods covered by three shipping bills on the ground that the bank realisation certificate towards export proceed in respect of the said shipping bills stands received by the appellant on 06.07.11. As the goods were not being released, the appellant approached the Honble High Court who directed to Commissioner to finalize the matter as soon as possible.
5. Vide his impugned order, the Commissioner has rejected the appellants prayer to release the bank guarantee of Rs.2 crores executed by the appellant at the time of earlier exports covered by three shipping bills dtd. 19.05.11, 20.05.11 and 28.05.11. He also rejected the appellants prayer for waiver of condition of furnishing the bank guarantee to the extent of 25% of the value of the goods recovered subsequently shipping bills dtd. 15.06.11. Hence the present appeal.
6. It stands contested by the ld. Advocate appearing for the appellant that they had given earlier the bank guarantee for Rs.2 crores for provisional release of earlier export consignment. They have received the full remittance from their overseas buyers to the extent of Rs.9.25 crores. The said exports were made under DEPB claim which runs into Rs. 60 lakhs. The said claim is still with the Revenue and has not been sanctioned.
In respect of the present consignment for export, ld. Advocate submits that there is no justification for putting the condition of giving bank guarantee to the extent of 25% of the value of the goods. He submits that the said export is also under DEPB claim. The earlier DEPB claim to the tune of Rs.3.5 crores are still pending with the Revenue. The appellant is a Govt. approved export house working for the last 11 years and not a single case has been made out against them. He submits that the appellant is running into demurrages of around Rs.8 lakhs which is increasing everyday. Value of present export is to the tune of Rs.3 crores and export benefit out of the same are around Rs.22 lakhs. As such it is not justifiable on the part of the Revenue to seek bank guarantee of 25% of the value of the goods for releasing the same. He submits that the goods can be released subject to the appellant entering into a personal bond. In support of his above submissions, he relies on the Boards Circular No.1/2011-Cus, dtd. 4.1.11.
7. Ld. DR appearing for the Revenue also relies upon the same Boards Circular and says that where export goods are suspected of mis-declaration and further enquiry/confirmatory test or expert opinion is required, the goods should be allowed exportation provisionally subject to the exporters executing a bond equal to an amount of the value of the goods and furnish appropriate security in order to cover the redemption fine and penalty. As such he submits that the directions of the Commissioner for execution of bank guarantee and bond are appropriate and should be upheld.
8. After considering the submissions made by both sides, we find that the appellant had already given a bank guarantee of Rs. 2 crores to cover the earlier three consignments. The exports are being made under DEPB scheme. Even if the Revenues case is proved the consequence of the same would be denial of said DEPB. The Revenue has already drawn samples from the present consignment, in which case provisional release of the same would not cause any adverse affect to the Revenues case. Even in terms of the Boards Circular it stands observed that inordinate detention of the seized goods entered for exportation results in delays in fulfillment of export order and at times cancellation of such orders. Detention of goods also adds to congestion in ports besides payment of demurrages charges to the custodian.
9. We also note, the appellants contention in respect of earlier exports, they have realized the full export value from their overseas buyers. Further an amount of around Rs.3 crores is pending to be given to the appellant as DEPB benefit. In these circumstances, we are of the view that directions of the adjudicating authority to further execute bank guarantee of 25% of the value of consignment is harsh and unjust. As such taking into account the overall facts and circumstances of the case, we hold that the earlier bank guarantee of Rs. 2 crores executed by the appellant should be considered as sufficient to cover present consignment also considering the quantum of reasonable fine and penalty that can be imposed in this case. Therefore, there is no need to give further bank guarantee as directed by the Commissioner. The appellant is directed to furnish a bond for an amount equal to the value of goods and letter from the bank to the effect that the bank guarantee already executed will cover the dispute about this shipment also and the same would be kept alive. Consignment in question should be released provisionally immediately thereafter. In the circumstances, appellants prayer for refund of bank guarantee of Rs. 2 crores is rejected. Appeal is disposed in above terms.
(Pronounced in the Open Court on 08.12.2011) (Archana Wadhwa) Judicial Member (Rakesh Kumar) Technical Member RK-I ??
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