2013 (12) TMI 1348 - AT - Customs

Import of goods duty free under the value based advance Licensing Scheme - Notification No. 203/92-Cus. - Held that - appellant is a merchant manufacturer is not in dispute and to that fact they have produced a certificate issued by the Divisional Deputy Commissioner certifying that the appellants are the merchant-manufacturer. Therefore, they have not availed the Cenvat credit. This certificate has also not disputed by the adjudicating authority also - appellant have discharged their onus to prove that they have not availed inputs stage credit of the imported goods, which were used in the manufacture of the exported goods. Further, in the case of Consumers Plastic Pvt Ltd., (2001 (7) TMI 456 - CEGAT, MUMBAI) this Tribunal has categorically held that the burden is to prove that the appellants have availed input stage credit is on Revenue. Admittedly, in this case the Revenue has not produced any documentary evidence to show that the appellants or supporting manufacturer have availed input stage credit - Decided in favour of assessee.

Summary

Issues:
1. Challenge to impugned order regarding duty exemption under Notification No. 203/92-Cus.
2. Availability of input stage credit for goods imported for manufacturing of exported goods.
3. Dispute over the burden of proof regarding availment of input stage credit.

Issue 1: The appellants contested the impugned order challenging the duty demand under Notification No. 203/92-Cus. The case involved the import of goods duty-free under the value-based advance Licensing Scheme. The appellants, merchant-manufacturers, exported goods manufactured by a supporting manufacturer, and obtained EODC from DGFT. A show-cause notice was issued alleging the appellant's obligation to not avail input stage credit under Rule 57A for imported goods used in manufacturing exported goods. The adjudicating authority confirmed the duty demand, interest, and imposed a penalty. The appellants appealed against this order.

Issue 2: The appellant argued that as per Notification No. 203/92, they were not entitled to take input stage credit for goods imported for manufacturing exported goods since they were merchant-manufacturers. The appellant contended that the actual manufacturer paid duty, and the notification prohibited obtaining credit under Rule 56A/57A. The appellant relied on certificates issued by the Deputy Commissioner and Range Superintendent to support their claim. The Revenue opposed, stating the appellant failed to prove non-availment of input stage credit and did not declare the supporting manufacturer's name during import.

Issue 3: The Tribunal found the appellant to be a merchant manufacturer based on a certificate issued by the Divisional Deputy Commissioner. It was noted that the supporting manufacturer paid duty by debiting PLA/RG23B, indicating compliance with non-availment of input stage credit under Notification No. 203/92. The Tribunal held that the burden of proof regarding input stage credit availment rested on the Revenue, which failed to provide evidence of such availment. Consequently, the impugned order was set aside, and the appeal was allowed.

In conclusion, the Tribunal ruled in favor of the appellant, emphasizing their compliance with the conditions of Notification No. 203/92 and the Revenue's failure to prove the alleged availment of input stage credit. The judgment highlighted the importance of documentary evidence and the burden of proof in such cases, ultimately leading to the dismissal of the duty demand and penalty imposed on the appellant.