2007 (8) TMI 232 - AT - Customs

Import under duty free scheme under the pass book Transporter s receipt, Consumption register& Form 31 issued by ST authorities were considered by Comm.(A) which shows that goods have traveled to importers premises & utilized in mfg. of export product Demand raised is not sustainable.

Summary

Issues: Mis-utilization of duty exemption scheme, recovery of duty, penalties, remand order scope, examination of documentary evidence, disposal of imported goods, authenticity of documents.

Mis-utilization of duty exemption scheme: The case involved the mis-utilization of the duty exemption scheme by various import-export pass book holders, where imported goods were sold in the open market instead of being used in the manufacture of export products. The investigation revealed that goods imported duty-free were sold locally instead of being utilized for the intended purpose.

Recovery of duty and penalties: The Commissioner of Customs issued a show cause notice proposing the recovery of customs duty on the imported goods not reflected in the firm's financial records. The notice also proposed penal action against the importing firm, its partner, and other individuals involved. The Commissioner imposed personal penalties on the firm and individuals, which were challenged through appeals.

Remand order scope and examination of documentary evidence: The Tribunal remanded the case to the adjudicating authority for examining the evidence on record. The Commissioner's order was challenged on the grounds that he considered documents beyond the scope of the remand order, and that the investigating authority was not given an opportunity to verify the authenticity of new documents submitted.

Disposal of imported goods and authenticity of documents: The Revenue contended that the imported goods were disposed of in Mumbai without being transported to the factory for further utilization, urging that the impugned order be set aside. However, the Commissioner examined various documents, including transport receipts and Form 31 issued by Sales Tax authorities, to establish that the goods were indeed moved to the factory and utilized in the manufacture of export products. The Commissioner's decision was upheld as the Revenue failed to provide evidence to challenge the authenticity of the documents presented.

In conclusion, the Tribunal upheld the Commissioner's decision, rejecting the appeals filed by the Revenue. The case highlighted the importance of proper utilization of duty exemption schemes and the need for thorough examination of documentary evidence to establish compliance with customs regulations.