2015 (4) TMI 116 - CGOVT - Central Excise

Duty demand - Non submission of original and duplicate of ARE-1 duly certified by the Customs Authority - Loss of documents - Imposition of penalty under Rule 25 - Held that - Applicant had exported goods valuing ₹ 30,60,964.20 vide ARE-1 No. 1/09-10 dated 16.09.2009 under bond. Since no proof of export was submitted, Range Supdt. vide letter dated 22.03.2010 asked the exporter to submit proof of export. Applicant vide letter dated 25.07.2010 claimed to have exported the goods vide shipping bill No. 7154864 dated 15.09.2009 and contended that ARE-1 original & duplicate could not be produced as they were lost. Original authority after following due process of law confirmed the demand of ₹ 2,52,223/- along with interest and also imposed penalty of ₹ 2,52,223/- under rule 25 of Central Excise Rules 2002. Commissioner (Appeals) upheld the said order-in-original. - It is quite clear that department had made efforts to ascertain whether said goods were exported but it could not be confirmed by Assistant Commissioner Customs CFS Mulund. It is the responsibility of exporter submit valid proof of export in time which he failed to submit. Rather he has blamed the department for failure in internal communication. Government observes that applicant exporter has failed to submit valid proof of export and therefore demand of duty is rightly confirmed in this case. The penalty equal to the duty involved, imposed in this case is quite harsh. Therefore, Government reduces the penalty to ₹ 20,000/- under rule 25 of the Central Excise Rules, 2002 - Decided partly in favour of assessee.

Summary

Issues:
1. Duty demand on exported goods
2. Delay in filing appeal
3. Condonation of delay
4. Validity of proof of export
5. Responsibility for proof of export
6. Penalty imposition

Duty Demand on Exported Goods:
The applicant, engaged in manufacturing excisable goods, exported goods under self-sealing procedure at nil duty rate. However, due to the loss of original and duplicate copies of the export documents, a duty demand of Rs. 2,52,223 was confirmed by the adjudicating authority, along with interest and a personal penalty of an equal amount under Central Excise Rules, 2002.

Delay in Filing Appeal:
The appeal filed by the applicant before the Commissioner (Appeals) was rejected as time-barred due to a delay of 30 days in filing the appeal, leading to further aggrievement by the applicant.

Condonation of Delay:
The applicant filed a revision application before the Central Government under Section 35 EE of the Central Excise Act, 1944, citing grounds such as incorrect inquiries, liberal approach guidelines from the Supreme Court, circumstances causing delay, and the rejection of the condonation of delay application by the Commissioner (Appeals).

Validity of Proof of Export:
The applicant contended that despite the loss of ARE-1 documents, other evidence such as the Central Excise invoice, commercial invoice, shipping bill, and bank realization certificate, proved the export of goods beyond doubt. The applicant argued that the insistence on the production of ARE-1 was unfair.

Responsibility for Proof of Export:
The Government noted that the applicant failed to submit valid proof of export within the required timeframe, leading to inquiries by the department to confirm the export. The responsibility to provide valid proof of export lies with the exporter, and the failure to do so resulted in the confirmation of duty demand.

Penalty Imposition:
While the penalty imposed was initially equal to the duty demand, the Government found it to be harsh and reduced it to Rs. 20,000 under Central Excise Rules, 2002. The impugned order-in-appeal was modified accordingly, addressing the issue of penalty imposition.

In conclusion, the revision application was disposed of with the modification of the penalty imposed, emphasizing the importance of timely submission of valid proof of export and the responsibility of exporters in fulfilling documentation requirements to avoid duty demands and penalties.