2008 (3) TMI 570 - AT - Customs

Summary

Issues:
1. Application for staying the recovery of duty and penalty.
2. Conversion of imports and exports under the Advance Licence to the jobbing scheme.
3. Rejection of conversion request by the Commissioner based on CBEC Circular No. 4/2004.
4. Compliance with conditions under Notification No. 32/1997 for conversion.

Analysis:
1. The judgment involves an application for staying the recovery of duty and penalty. The Tribunal noted the existence of a Bank Guarantee amounting to Rs. 13,97,504/- and decided to dispense with the payment of the balance amount of duty. The appeal was taken up for final disposal, indicating a favorable decision for the appellant regarding the recovery issue.

2. The case pertains to the conversion of imports and exports under the Advance Licence to the jobbing scheme. The appellants imported goods under the advance licence scheme, exported them after job work, and faced cancellation of the advance licence by DGFT due to non-applicability of the scheme. The Customs rejected their request for conversion to the jobbing scheme, citing restrictions from a Board's Circular. The appellant argued compliance with conditions under Notification No. 32/1997 for conversion.

3. The Commissioner's rejection of the conversion request was primarily based on the absence of a provision in CBEC Circular No. 4/2004 for converting bills of entry and shipping bills to the jobbing scheme. The Tribunal found the rejection insufficient as it did not consider the appellant's claim of satisfying conditions under Notification No. 32/1997. The matter was remanded to the original authority for verification of compliance with the conditions and a reasoned decision.

4. The Tribunal directed the original authority to examine whether the conditions under Notification No. 32/1997 could be verified for compliance. If found compliant, the conversion request should be allowed. However, if non-compliance or unverifiable conditions were identified, a reasoned order was to be passed. The appeal was allowed by way of remand, with the appellants instructed to maintain the bank guarantee until a final decision is reached.