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Issues involved: Appeal against order of Commissioner of Customs (Import) dated 9-10-2003 regarding import duty, confiscation, and penalty u/s 112(a) of Customs Act, 1962.
Summary: Issue 1: Allegation of duty-free import and availing input stage credit: The appellants part-purchased a transferable license and imported consignments under 4 Bills of Entry in July 1995. A show cause notice was issued for recovering customs duty of Rs. 25,04,782/- alleging duty-free import against export obligations, availing input stage credit in violation of regulations. The Commissioner confirmed a demand of Rs. 20,45,918/- on appellants for 4 Bills of Entry along with interest and penalty u/s 112(a) of Customs Act, 1962. Issue 2: Burden of proof and extended period of limitation: Appellants denied receiving the show cause notice and argued that burden of proof lies on the department to show availing of modvat credit. They contended that demand was beyond the normal limitation period and required clear evidence of deliberate suppression. Citing precedent cases, they argued that burden of proof cannot be shifted to the importer. Issue 3: Tribunal's analysis and decision: The Tribunal examined the Exim Policy and Notification 203/92-Cus., emphasizing the responsibility of the original license holder to fulfill export obligations. It noted the transfer of license to the appellants and ruled that burden of proof to show credit availed by the licensee rests with the department. As the department failed to prove suppression or collusion, the impugned order was set aside, and the appeal was allowed with consequential relief. Conclusion: The Tribunal ruled in favor of the appellants, emphasizing the department's failure to prove allegations and shifting burden of proof. The impugned order was deemed unsustainable, and the appeal was allowed with appropriate relief.
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