2013 (7) TMI 134 - HC - Customs

Export obligation - import of duty free goods against advance licenses - waiver of pre deposit - stay - held that - Although the appellants had failed to produce documents to establish that exports under the 37 advance licenses have been effected, before the Tribunal passing the pre-deposit order, in view of the fact that the appellants have subsequently produced documents to show that the exports have been effected and it is claimed that the exports effected are more than the export obligation required to be fulfilled as against the imports under the said 37 advance licenses, in our opinion it would be just and proper to set aside the pre-deposit order and direct the Tribunal to pass fresh order in that behalf.

Summary

Issues:
Whether CESTAT was justified in directing pre-deposit for entertaining the appeal against order-in-original.

Analysis:
The appellants had obtained 106 advance licenses with an obligation to fulfill export obligation by importing duty-free raw materials. The adjudicating authority confirmed duty demand for imports made under these licenses due to failure in providing documents showing fulfillment of export obligation.

Challenging the orders, the appellants filed appeals before CESTAT. They could produce documents for 69 licenses but not for the remaining 37 licenses. Consequently, CESTAT directed pre-deposit of duties/penalties. Subsequently, the appellants filed Miscellaneous Applications stating they could retrieve documents proving exports under the 37 licenses. However, the Tribunal refused to consider these applications, leading to the filing of these appeals.

Although documents for exports under the 37 licenses were not produced before the pre-deposit order, the appellants later presented evidence showing exports had been made, exceeding the required export obligation. Therefore, the High Court deemed it appropriate to set aside the pre-deposit order and instructed CESTAT to reconsider the matter.

As a result, the High Court quashed the impugned pre-deposit orders, restoring the case to CESTAT for fresh consideration. The appeals were disposed of with no costs, keeping all contentions open for both parties.