2013 (4) TMI 589 - AT - Central Excise

Waiver of pre-deposit - Violation of conditions of Notification No. 23/2003-C.E - Violation of Foreign Trade Policy - Held that - Regarding Violation of conditions of Notification No. 23/2003-C.E - Held that - We find that Notification No. 23/2003-C.E. only talks about clearances of the goods to the person who is holding an advance release order or advance licence in terms of para 4.1.1 of the export policy. It is undisputed in this case that the clearances affected by the appellant was to advance licence holder who has been producing the advance release orders to the appellant, who in turn produced the same to the jurisdictional authoritie - Appellants have been following the provisions of Notification No. 23/2003-C.E. correctly for all the clearances made to advance licence holders. As regards the violation of the paras 6.8 & 6.9 of the Foreign Trade Policy, we find that it is a settled law that such violations, if any, can be only adjudged by the DGFT authorities. We also find that the appellant had been clearing the goods under advance licence/advance release order, during the period 2005 to 2008 while the show cause notice has been issued on 18-3-2010 which seems prima facie to be time barred, inasmuch as the clearances were countersigned by the range Superintendent in-charge of the appellant s factory. Prima facie - We find that the appellant has made out a case for the complete waiver of the pre-deposit of the amounts involved - Application for the waiver of pre-deposit of the amounts involved is allowed - Recovery thereof stayed till the disposal of appeal.

Summary

Issues involved: Stay petition for waiver of pre-deposit of duty amount confirmed by adjudicating authority along with interest and penalty. Violation of conditions of Notification No. 23/2003-C.E. and Foreign Trade Policy.

Analysis:

1. Violation of conditions of Notification No. 23/2003-C.E.:
The adjudicating authority confirmed the duty amount on the grounds of the appellant producing advanced release orders instead of advance licenses for goods clearance, violating Notification No. 23/2003-C.E. The appellant argued that specific examples of debits in licenses were authorized by the Superintendent of Central Excise, indicating compliance. The Tribunal observed that clearances were made to advance license holders as per the Notification's provisions, evident from the documents submitted. The Tribunal found the appellant followed the Notification correctly for clearances to advance license holders.

2. Violation of Foreign Trade Policy - Paras 6.8 & 6.9:
The appellant, being an export-oriented unit, was expected to export the entire production and granted clearance benefits subject to conditions under para 6.8 of the Foreign Trade Policy. The respondent argued that clearances to DTA under advance release orders did not qualify as exports under para 6.8. However, the Tribunal noted that any violations of paras 6.8 & 6.9 should be adjudged by DGFT authorities. The Tribunal found that the appellant's clearances under advance licenses/orders from 2005 to 2008, challenged in a show cause notice in 2010, appeared time-barred. The Tribunal concluded that the appellant had a case for complete waiver of pre-deposit based on the evidence presented.

3. Decision and Order:
After considering submissions from both sides and reviewing the records, the Tribunal granted the appellant's stay petition for the waiver of the pre-deposit of the duty amount, interest, and penalty. The Tribunal observed that the appellant had complied with Notification No. 23/2003-C.E. for clearances to advance license holders and found the show cause notice time-barred. The recovery of the amounts involved was stayed pending the appeal's disposal, providing relief to the appellant.

This detailed analysis of the judgment highlights the key issues of the case, the arguments presented by both parties, and the Tribunal's decision based on the legal provisions and evidence presented during the proceedings.