2008 (7) TMI 256 - AT - Customs

Appellants imported Soyabin Oil and Palm Oil for mfg. of Vanaspati and availed benefit of Not. No.16/2000-Cus. denial of exemption on ground of short quantity of goods received at port- appellants contend that palm oil and soyabin oil are in liquid form and there is some spilling at the time of loading and unloading - held that since there is no allegation of diversion of goods for other purpose, the benefit of notification cannot be denied in respect of goods lost due to leakage or damage

Summary

Issues:
1. Benefit of Notification No.16/2000-Cus. dated 1-3-2000 availed by appellants for import of Soyabin Oil and Palm Oil.
2. Demand of duty in respect of short delivered and short received quantities.
3. Allegation of diversion of goods by the appellants.
4. Applicability of the decision in the case of BPL Display Devices Ltd. v. CCE, Ghaziabad.
5. Contention of Revenue regarding duty payment for short received quantity.
6. Whether demand can be made for quantity not received by the importer.

Analysis:
1. The appellants imported Soyabin Oil and Palm Oil availing the benefit of Notification No.16/2000-Cus., providing concessional duty rates for vegetable oil imported for vanaspati manufacture. A show-cause notice demanded duty for 86.002 M.T. short delivered at port and 71.851 M.T. short received in the factory. The Commissioner (Appeals) upheld the demand for the latter quantity, citing lack of evidence of intended use.

2. Appellants argued that spillage during loading and unloading caused the discrepancy, denying diversion allegations. They referenced the Supreme Court's decision in BPL Display Devices Ltd. v. CCE, Ghaziabad, emphasizing benefit entitlement despite loss due to leakage or damage.

3. Revenue's appeal regarding duty for the 86.002 M.T. quantity was dismissed. The Revenue contended duty payment for short-received goods, opposing benefit entitlement under the notification.

4. The Tribunal noted the absence of diversion allegations against the appellants and cited the BPL Display Devices Ltd. case to support benefit retention despite loss. The Supreme Court's ruling emphasized the intended use criterion for exemption, distinguishing diversion from unintended loss.

5. The Tribunal allowed the appellants' appeal, acknowledging no diversion evidence. The Revenue's appeal was dismissed as the disputed goods were not received by the appellants, upholding the order setting aside the demand for that quantity.

6. The judgment favored the appellants due to the lack of diversion accusations, aligning with the BPL Display Devices Ltd. precedent. The Tribunal upheld the benefit entitlement under the notification for the imported oils, settling the duty dispute in favor of the appellants and dismissing the Revenue's appeal.

This detailed analysis of the judgment addresses all the issues involved comprehensively, highlighting the key legal arguments and decisions made by the Tribunal.