2008 (12) TMI 559 - AT - Central Excise

Summary

Issues:
1. Short receipt of imported goods at SEZ.
2. Discrepancy in weight of goods declared in Bill of Entry and actual weight received.
3. Applicability of SEZ Rules, 2006 and Customs Act, 1962.
4. Tolerance limits for variation in weight of goods.
5. Commissioner (Appeals) decision on duty confirmation based on shortages.
6. Verification of goods received at SEZ and examination by jurisdictional authority.

Analysis:
1. The case involved a dispute regarding the short receipt of imported goods at the Special Economic Zone (SEZ). The appellants contested the findings of the Assistant Commissioner, arguing that there was no evidence of tampering or diversion of goods during transit from the Port to the SEZ. They emphasized that all bundles were intact upon receipt at the SEZ, and discrepancies in weight could be attributed to variations in weighing equipment and procedures at different locations. The appellants relied on various Tribunal decisions to support their argument.

2. The main contention revolved around the discrepancy in the weight of goods as declared in the Bill of Entry and the actual weight received at the SEZ. The appellants highlighted that the weight difference was within tolerance limits specified in international standards (BS 4449) and the Purchase Order, Bill of Lading, and Packing List. They argued that the minor variation in weight did not justify the demand for customs duty, especially considering the nature of the goods as solid bars.

3. The appellants also challenged the sustainability of the Notice issued under Section 28 of the Customs Act, 1962, emphasizing that the assessment granting duty exemption had not been challenged by the department. They contended that the demand for duty was not tenable under Rule 29(2)(f) and (g) of the SEZ Rules, 2006. Additionally, they criticized the Assistant Commissioner for not following relevant decisions and norms in similar cases.

4. The Commissioner (Appeals) upheld the duty confirmation based on shortages of imported goods at the SEZ unit, citing a Tribunal decision in a similar case (Savita Chemicals v. CCE). The Commissioner's decision was contrary to the appellants' arguments regarding the intact receipt of all bundles and the minor weight discrepancy being within acceptable limits.

5. Upon reviewing the facts and arguments presented, the Tribunal found no dispute regarding the tally of bars in bundles and numbers received at the SEZ. The Tribunal emphasized that the goods were examined and verified by the jurisdictional authority, with no discrepancies noted by the surveyor. Considering the nature of the goods as weldable debars, the Tribunal concluded that the minor variation in weight, explained by the importer and within tolerance limits, did not justify holding the appellants liable for duty payment.

6. Ultimately, the Tribunal set aside the impugned order and allowed the appeal, providing consequential relief to the appellant based on the comprehensive analysis of the facts, regulations, and arguments presented during the case proceedings.