2006 (5) TMI 274 - AT - Customs

Summary

Issues:
1. Appellant's liability for duty payment on imported goods using forged DEPB scrips.
2. Applicability of proviso to Section 28(1) of the Customs Act, 1962.
3. Finalization of provisional assessment and duty liability.
4. Commissioner's authority to remand the case for re-examination.
5. Bond execution and its implications on provisional assessment.

Issue 1: Appellant's liability for duty payment on imported goods using forged DEPB scrips:
The appellant imported edible oils through Mangalore Port using DEPB scrips, later found to be forged, causing a revenue loss of Rs. 75,78,417. The Special Investigation Branch discovered the forgery, leading to cancellation of the DEPB scrips. The Adjudicating Authority confirmed the duty liability was not discharged during clearance, but found no collusion or wilful misstatement by the importer or manager. The appellant challenged the Commissioner's order, arguing no evidence of involvement in the fraud.

Issue 2: Applicability of proviso to Section 28(1) of the Customs Act, 1962:
The appellant contended that the proviso to Section 28(1) did not apply due to the lack of evidence implicating them in the fraud. The Commissioner directed finalization of provisional assessment despite the absence of importer's involvement in the fraud. The appellant cited legal precedents and argued that the assessment was no longer provisional at the time of the order.

Issue 3: Finalization of provisional assessment and duty liability:
The Commissioner ordered finalization of provisional assessment due to the use of forged DEPB scrips, resulting in unpaid duty of Rs. 75,78,417. The Revenue argued that the duty liability remained unpaid despite the appellant's bonafide actions. The Tribunal upheld the Commissioner's decision, emphasizing the duty to recover lost revenue within the legal framework.

Issue 4: Commissioner's authority to remand the case for re-examination:
In a separate appeal, the Commissioner remanded the case back to the Original Authority for re-examination, allowing the appellants to present their case. The appellant argued that the provisional assessment should have been finalized upon submission of the Bill of Lading. However, the Tribunal upheld the remand order, stating it provided the appellants an opportunity to represent their case.

Issue 5: Bond execution and its implications on provisional assessment:
The appellant argued that the provisional assessment bond was executed for submitting the original Bill of Lading, and once submitted, the assessment should have been finalized. The Revenue contended that the delay in finalizing the assessment allowed for remedial action to recover the lost revenue. The Tribunal rejected the appellant's argument, stating the delay benefited the Revenue and upheld the remand order.

In conclusion, the Tribunal dismissed both appeals, upholding the Commissioner's decision on duty liability and the remand order for re-examination, emphasizing the duty to recover lost revenue within the legal framework.