2007 (4) TMI 425 - AT - Customs

Summary

Issues:
1. Allegation of mis-declaration in the use of HDPE granules in export products.
2. Validity of DEEC licenses permitting import of LDPE/HDPE granules.
3. Transferability of DEEC licenses and legality of HDPE import by transferees.
4. Decision on dropping proceedings against the respondents based on license conditions.

Analysis:

Issue 1: The main allegation in the case was regarding the mis-declaration of using HDPE granules in export products instead of LDPE granules, leading to the demand of duty and penalties.

Issue 2: The Commissioner found that the DGFT authorities had mistakenly issued licenses permitting the import of "LLDPE/LDPE/HDPE/PP" granules, although it was an error to include HDPE. The Commissioner concluded that there was no mis-declaration by the exporters, and the transferees legally imported HDPE as permitted by the licenses.

Issue 3: The Tribunal considered submissions from the Department's representative and the advocates for some respondents. It was acknowledged that the DGFT had erroneously issued licenses allowing the import of LDPE or HDPE, and there was no evidence of mis-declaration by the exporters. Despite requests, the licenses were not canceled. Therefore, the Tribunal upheld the Commissioner's decision, stating that no valid grounds existed to interfere with the findings.

Issue 4: The Tribunal rejected all 12 appeals by the Department against the dropping of proceedings by the Commissioner. The decision was based on the lack of evidence showing mis-declaration by the exporters and the validity of the licenses permitting the import of HDPE granules by the transferees as per the license conditions.

In conclusion, the Tribunal upheld the Commissioner's decision to drop the proceedings, emphasizing the lack of mis-declaration by the exporters and the legality of HDPE import by the transferees under the DEEC licenses.