2012 (6) TMI 218 - AT - Central Excise

Deemed export - supply to mega power project - sub contractor - International Competitive Bidding (ICB) denial of benefit of Notification no. 6/2006-CE dated 01.03.2006 by invoking the provisions of Exim Policy - Held that - Customs Notification 21/2002 does not provide any condition that the benefit is available subject to the provisions of the Exim Policy. Pre-deposit of duty, interest and penalties is waived for hearing of the appeals. stay petitions allowed.

Summary

Issues involved:
- Early hearing application for stay applications
- Demand confirmation and benefit denial of Notification no. 6/2006-CE
- Allegation of suppression with intent to evade payment of duty
- Time-barred demand
- Interpretation of Customs Notification 21/2002 and Exim Policy
- Prima facie case on merits and time-bar for the applicant

Analysis:
1. Early hearing application for stay applications: The Revenue filed an application for early hearing of the stay applications, which was dismissed as infructuous since the stay applications were already listed for the day.

2. Demand confirmation and benefit denial of Notification no. 6/2006-CE: The appellant filed an appeal against a demand amounting to Rs. 3,95,07,391/-, interest, and penalty, confirmed after denying the benefit of Notification no. 6/2006-CE dated 01.03.2006. The demand was based on the allegation that the applicant suppressed material facts with intent to evade payment of duty.

3. Allegation of suppression with intent to evade payment of duty: The applicant contended that they had sought guidance from the Revenue regarding clearance of goods under Notification 6/2006, and after receiving confirmation, they cleared the goods to the recipient. The applicant argued that the allegation of suppression with intent to evade payment of duty was not sustainable as they had followed the guidance provided by the Revenue.

4. Time-barred demand: The applicant claimed that the demand was time-barred as they had sought permission to clear goods under Notification 6/2006 on a specific date, and the same was reflected in their monthly returns. They argued that since all relevant facts were disclosed to the Revenue, the allegation of suppression should not hold.

5. Interpretation of Customs Notification 21/2002 and Exim Policy: The Revenue relied on Chapter 8 of the Exim Policy of 2004-2009 to argue that the recipient was not entitled to import goods without payment of duty, thereby justifying the demand. However, the Tribunal noted that Customs Notification 21/2002 did not impose any condition related to the Exim Policy for availing benefits.

6. Prima facie case on merits and time-bar for the applicant: The Tribunal found that the Revenue's attempt to deny the benefit of Notification 6/2006-CE by invoking the Exim Policy was not valid. Since Customs Notification 21/2002 did not link the benefit to compliance with the Exim Policy, the Tribunal ruled in favor of the applicant, waiving the pre-deposit of duty, interest, and penalties for the appeal hearings, allowing the stay petitions.

This detailed analysis covers the various issues involved in the legal judgment, providing a comprehensive understanding of the case and its implications.