2011 (1) TMI 31 - AT - Customs

Import of melting scrap of iron an steel - Concessional rate of duty - notification no. 21/2002 Cus dated 1.3.2002 - production of end-use certificates - Held that - Inasmuch as the appellate authority held in favour of the assessees on the legal issue but has confirmed part of the demand on the factual aspect, we are of the view that such factual aspect should be verified by the original adjudicating authority and the assessees can be given an opportunity to contest the same. Accordingly, we set aside the impugned order and remand the matter to the original adjudicating authority for verification of the fact of production/no-production of end-use certificates in respect of the disputed quantity.

Summary

Issues:
Interpretation of Notification No. 21/2002-Cus regarding the production of end-use certificates for imported melting scrap of iron and steel within a specified time frame.

Analysis:
The case involved the interpretation of Notification No. 21/2002-Cus, which allowed for the concessional rate of duty on imported melting scrap of iron and steel subject to the condition of producing end-use certificates within a specified time frame. The appellants, engaged in the manufacture of iron and steel ingots, imported four consignments of melting scrap under this notification. However, they failed to produce the end-use certificates within the stipulated six-month period, leading to proceedings being initiated against them for denial of the notification's benefit.

The Assistant Commissioner of Customs passed an order confirming a substantial duty amount along with interest due to the non-compliance with the end-use certificate requirement. On appeal, the Commissioner (Appeals) acknowledged that the end-use certificates were not submitted within the specified time frame but held that the benefit of the notification should not be denied solely on this ground. However, he confirmed a demand for duty in cases where the end-use certificates did not cover the entire imported quantities.

The appellate tribunal, while recognizing the legal issue in favor of the appellants, found a factual discrepancy regarding the coverage of quantities in the end-use certificates. As a result, the tribunal set aside the previous order and remanded the matter to the original adjudicating authority for verification of the production or non-production of end-use certificates for the disputed quantities. This decision aimed to provide the appellants with an opportunity to contest the factual aspect before a final determination on the duty liability.

In conclusion, the appellate tribunal's decision focused on ensuring a fair assessment of the factual discrepancies related to the end-use certificates for imported melting scrap of iron and steel, emphasizing the importance of verifying compliance with the notification's conditions before confirming duty liabilities.