Customs, Excise and Gold Tribunal - Mumbai
Commissioner Of Customs vs Bharat Pulverising Mills Ltd. on 2 November, 1995
Equivalent citations: 1999(107)ELT703(TRI-MUMBAI)
ORDER R. Jayaraman, Member (T)
1. The revenue have moved this application for granting stay against the Order-in-Appeal passed by the Collector (A) bearing No. 631/95 BCH., dated 11-9-1995. The respondents are the importers of goods against the DEEC licence transferred in their favour issued after obtaining suitable endorsement. The licence is quantity based licence and is governed by Customs Notification No. 204/92. Initially the licensing authorities refused to make the licence transferable on the [grounds] that the goods which were exported are prior export obligation basis and had availed of Modvat credit in respect of these inputs. Noticing this objection, the applicant reversed the Modvat credit taken in regard to the inputs used in those export goods and again approacahed the licensing authority, who endorsed the licence, permitting transfer of the inputs. On the basis of that licence, they have imported the goods. The Asst. Collector held that they have already availed of the Modvat credit in respect of the inputs used in the export goods and hence Condition No. (vi) of Notification 204/92 has been violated and in that view held that the goods are to be cleared on payment of duty amount to Rs. 5,43,256'/-. The respondents approached the Collector (Appeals). In the impugned order allowed the appeal of the respondent.
2. Shri Mondal, ld. SDR pleads that notwithstanding the transfer endorsed by the licensing authority, in the matter of interpretation of Customs Notification, the Customs authorities are entitled to go according to the provisions of the Notification. Condition No. (vi) clearly stipulated that where Modvat credit has been availed of in respect of inputs used in the resultant export product, transfer or sale facility of the input materials would not be available. There is no dispute that they had availed the Modvat facility. Hence Condition No. (vi) has been clearly violated. Hence notwithstanding the subsequent reversal of Modvat credit taken on the inputs, the benefit of duty free clearance in respect of such material imported under transfered licence cannot be available.
3. Prima facie, we find that the arguments made by the ld. DR do not appeal to us, because goods were exported not after obtaining DEEC licence but on prior export basis. The question of obtaining DEEC licence or their subsequent transfer might not have been decided at the time of export and may be exports have taken place in the normal course availing Modvat credit. Prima facie, we are unable to accept that when subsequently the Modvat credit is reversed, the benefit of duty free import under transferred licence can be denied. Moreover, provision contained in Condition No. (vi) appears to be to deny double benefit being taken and hence when one benefit is foregone it appears to be prima facie that other benefit cannot be denied. We are not persuaded to grant any blanket stay. However accepting the plea that some safeguard should be provided for securing the revenue, we direct the applicant to give a personal bond covering the duty amount on the basis of which the department should implement the order of the Collector (Appeals).