2002 (9) TMI 702 - AT - Central Excise

Summary

Issues:
The issues involved in the judgment are the demand of customs duty short-levied on Steel Melting scrap imported by the appellants, specifically focusing on the demand of Special Additional duty and duty on goods found in excess.

Customs Duty Demand:
The Commissioner demanded Rs. 1,18,179/- as customs duty short-levied on Steel Melting scrap imported by the appellants, comprising Rs. 1,12,977/- for Special Additional duty and Rs. 5,202/- for excess goods. The duty demand was accompanied by interest and penalty equivalent to the duty demand.

Special Additional Duty Demand:
The demand of Special Additional duty was based on the appellants selling the imported melting scrap to buyers in an area where no tax is chargeable on sale or purchase of goods. The appellants argued that the sale was not in conformity with Notification No. 22/99-Cus., which specified rates of duty and exempted sales in certain areas from duty.

Excess Goods Demand:
Regarding the excess goods demand, it was alleged that the appellants cleared 1.68 MTs of melting scrap over the declared quantity. The appellants contended that no excess quantity was found at the time of clearance and the alleged excess could be due to errors in weighment during sale.

Legal Position Analysis:
The learned Counsel for the appellants argued that the duty demand was based on a misunderstanding of the legal position. They pointed out that the place from where sales take place, not the place of the buyer, was the relevant factor under Notification No. 22/99. The appellants emphasized that the duty demand was erroneous as the goods were sold in a place subject to sales tax.

Judgment and Conclusion:
After considering the submissions, the Tribunal found that the duty demand was made on an erroneous understanding of the legal position. The Tribunal agreed with the appellants that the duty demand was contrary to the terms of the Notification. Additionally, the Tribunal found no merit in the excess quantity claim, noting that the alleged excess was negligible and not substantiated by actual weighment at clearance. Consequently, the impugned order was set aside, and the appeal was allowed with the appellant entitled to consequential relief, if any.