2017 (4) TMI 1304 - Commission - Customs

Dual benefit of both Zero Duty EPCG Scheme and SHIS Scheme - violation of provisions of N/N. 102/2009-Cus., dated 11-9-2009 as amended - Held that - the applicant is not eligible for availing the benefit of N/N. 102/2009-Cus., dated 11-9-2009 and cannot avail both benefits in the same year. One of the essential condition for grant of EPCG license is that the beneficiary would not apply for SHIS. This is also evident in the SCN, which has not been disputed. Therefore, having applied for SHIS, the applicant has deprived himself of the benefit of EPCG. Further, it is noticed that at the time of filing of the Settlement Application, the applicant had admitted the customs duty liability of ₹ 38,90,988/- in respect of imports made under the EPCG license. It is clear that this Commission cannot settle the case for less duty than the duty admitted at the time of filing of the application and the argument for lesser liability is therefore superfluous even otherwise. However, there appears to be no mala fide intent to conceal the facts or evasion of duty and the applicant has cooperated fully during the proceedings. Immunities granted to the applicant u/s 127H(1) of the Act - application disposed off.

Summary

Issues:
Settlement applications under Section 127B of the Customs Act, 1962 regarding dual benefit availed by the applicant, denial of customs duty benefit, penalty, confiscation of goods, and transfer of application.

Analysis:
The settlement applications, numbered 5228/2016, 5266/2016, 5229/2016, and 5267/2016, were filed by the applicant and co-applicant under Section 127B of the Customs Act, 1962. The dispute arose from availing dual benefits under Zero Duty EPCG Scheme and SHIS Scheme, leading to a Show Cause Notice issued by the DRI. The applicant admitted the duty liability and requested immunity from penalty and prosecution. The case was transferred to the Principal Bench, Delhi, for settlement.

Upon investigation, it was found that the applicant had applied for both schemes, violating the provisions. The Settlement Commission observed that the applicant was not eligible for both benefits simultaneously. The applicant admitted the customs duty liability at the time of filing the application, which cannot be settled for less than the admitted amount. The Commission noted the lack of mala fide intent and full cooperation from the applicant during the proceedings.

Considering the circumstances, the Commission settled the case under Section 127C(5) of the Act. The settlement included the payment of customs duty, interest, penalty, and an option for the applicant to redeem the seized goods on payment of a fine. Immunity from prosecution was granted to the applicant and co-applicant under Section 127H(1), with specific conditions outlined in the order.

The order highlighted provisions for withdrawal of immunity in case of non-compliance or false evidence. It also specified the consequences of non-payment of the settled amount within the stipulated time. The applicant was advised on the implementation of the order, and a copy was provided to the jurisdictional Commissioner for reference and enforcement.