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2014 (12) TMI 1075 - AT - CustomsImport of Crude Palm Oil (CPO) - Availment of concessional rate of Customs duty - CPO converted to Refined Oil with the help of job worker - Held that - Words take action to recover have been interpreted differently by the Tribunal in two different orders. Even though, the decision of the Tribunal in the case of PCS Industries Ltd. (2013 (7) TMI 344 - CESTAT MUMBAI) was rendered on 12-6-2013 and the decision in the case of Molex (I) Ltd. (2010 (12) TMI 1046 - CESTAT, BANGALORE) was rendered on 1-12-2010, the decision in the case of Molex (I) Ltd. was not brought to the notice of the Tribunal in the case of PCS Industries Ltd. Nevertheless, the fact remains that there are contrary decisions on the same issue. It has to be noted that the decision in the case of Molex (I) Ltd. considered the relevant provisions in greater details and provided an explanation for coming to the conclusion. In view of the above, in our opinion, the appellants have made out a case for complete waiver of pre-deposit and stay against recovery during pendency of the appeals. - Stay granted.
Issues:
1. Import of Crude Palm Oil (CPO) under concessional rate of Customs duty for manufacturing Refined Oil. 2. Alleged violation of Customs rules by processing CPO through a job worker without permission. 3. Confirmation of demand under Section 28 of Customs Act invoking Rule 8 of the Rules. 4. Interpretation of Rule 8 regarding the authority to take action for non-compliance with import conditions. Issue 1: Import of CPO for manufacturing Refined Oil The case involved M/s. Poshak Oils & Fats Ltd. importing Crude Palm Oil (CPO) under concessional Customs duty with the condition to follow Customs rules for manufacturing Refined Oil. The appellants converted CPO to Refined Oil through a job worker without obtaining necessary permission or following prescribed procedures. However, there was no evidence of diversion of imported CPO or non-compliance with notification conditions, with the only violation being processing by a job worker. Issue 2: Alleged violation of Customs rules The demand was confirmed under Section 28 of the Customs Act by invoking Rule 8 of the Rules. The learned consultant argued that the demand was without jurisdiction, citing a previous Tribunal decision. He contended that any omission by the appellant was procedural, and the substantive requirement of the notification had been met. The absence of a contrary finding supported the appellant's case against the impugned order, seeking a waiver of pre-deposit of adjudged dues. Issue 3: Confirmation of demand under Section 28 The Assistant Commissioner of Central Excise was argued to have the power under Rule 8 to take action for non-compliance with import conditions. Reference was made to a previous decision where it was held that the Assistant Commissioner should act in cases of notification violations. The Tribunal considered the submissions from both sides and analyzed the interpretation of Rule 8 in different cases, highlighting conflicting decisions on the authority responsible for taking action in such instances. Issue 4: Interpretation of Rule 8 The Tribunal examined the language of Rule 8, emphasizing the duty of the Assistant Commissioner of Central Excise to ensure proper use of imported goods and take action if they are not used as intended. Different interpretations of the phrase "take action to recover" were presented from previous Tribunal decisions, showcasing the divergence in understanding. Despite conflicting views, the Tribunal concluded that the appellants had a strong case, warranting a waiver of pre-deposit and a stay against recovery during the appeal process. The decision was based on the need for clarity and consistency in interpreting the relevant provisions.
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