2002 (11) TMI 644 - AT - Central Excise

Stay/Dispensation of pre-deposit - Demand - Penalty - Interpretation of statutes - Exemption notification

Summary

Issues:
- Waiver of deposit of duties and penalties for various parties.
- Interpretation of relevant exemption notifications.
- Liability for duty payment on goods cleared into the domestic tariff area.
- Imposition of penalties on carriers for transporting goods without duty payment.

Analysis:
1. The judgment involves applications for waiver of deposit of duties and penalties by multiple entities, including Sarla Polyester Ltd., Madhusudan Jhunjhunwala, Satishkumar Sharma, Dinesh Chandra Pandey, M.M. Sanghavi, Hindustan Cotton Co., Gopal Bhagwan Dutt Sharma, and Jaipur Golden Transport Co. P. Ltd. The demand for duty on yarn by Sarla Polyester Ltd. is based on goods cleared in the domestic tariff area without payment, leading to penalty imposition on related parties.

2. Sarla Polyester Ltd., an export-oriented unit, faces duty demand on yarn types due to non-payment in the domestic area. Other parties like Madhusudan Jhunjhunwala, Satishkumar Sharma, and Gopal Bhagwan Dutta Sharma are linked to Sarla Polyester Ltd. Hindustan Cotton Co. and Jaipur Golden Transport Co. P. Ltd. are penalized for involvement in transporting goods without duty payment.

3. Legal representation for the applicants is provided by Prakash Shah, except for Jaipur Golden Transport Co. P. Ltd., represented by its executive, Mr. Prem Hinduja. The counsel for Sarla Polyester Ltd. argues for a reduced duty amount under specific sections and exemption notifications, citing relevant case law for support.

4. The debate centers on the computation of duty payable and the availability of exemptions under the law. Sarla Polyester Ltd.'s counsel argues for a lower duty amount based on statutory provisions and offers additional deposits as evidence of good faith. Reference is made to Supreme Court and Tribunal judgments to strengthen the argument.

5. The departmental representative argues against reducing duty for goods cleared without payment, emphasizing the importance of upholding legal provisions. Reference is made to a previous Tribunal decision for reconsideration due to potential conflicting interpretations.

6. The Tribunal acknowledges the importance of interpreting statutes and notifications as per their plain meaning. While considering the ambiguity in the exemption notification, the Tribunal emphasizes adherence to the notification's literal interpretation. The decision in a previous case is upheld, and a waiver is granted based on the applicant's offer to deposit a specific amount.

7. Accepting the offer, the Tribunal waives deposit of duties and penalties for the applicants upon the specified deposit. Recovery of the waived amounts is stayed pending compliance.

8. Regarding the carrier, the Tribunal accepts the plea of good faith by its employee and waives the penalty imposed. The penalty imposition was primarily due to misrepresentation of the consignor, not the carrier's awareness of duty evasion during transportation.

9. The judgment concludes with a compliance deadline set for one of the parties involved, emphasizing the Tribunal's decision on waiver and recovery stays for duties and penalties.