2008 (11) TMI 191 - AT - Customs

DEEC benefits import of re-rollable scrap versus HMS - what was permitted under the DEEC licence was import of re-rollable scrap and what was imported is HMS - Under these circumstances, it will not be proper to extend the benefit of DEEC benefits for the said goods and also enforce the condition imposed under the concerned notification

Summary

Issues:
1. Interpretation of DEEC licence terms and Notification No. 203/92-Cus.
2. Validity of the Commissioner's order on confiscation, duty recovery, and penalty imposition.
3. Eligibility for concessional rate of duty under Notification No. 83/90-Cus.
4. Liability for Countervailing Duty (CVD) under Notification No. 44/93-C.E.
5. Applicability of Supreme Court decision in CC, Calcutta v. Indian Rayon & Industries Limited.

Analysis:
1. The case revolved around the appellants importing Heavy Melting Scrap (HMS) under a DEEC licence meant for re-rollable scrap, leading to a demand notice for Rs.15,35,392. The Tribunal remanded the matter to re-examine export obligations and Modvat credit availment by input suppliers.

2. Post remand, the Commissioner ordered confiscation of re-rollable scrap, redeemable on a fine of Rs. 3,00,000, with duty recovery, interest, and a penalty of Rs. 2,00,000 imposed on the appellant.

3. The appellant argued that as HMS was not covered under the DEEC licence, they were willing to pay applicable duty and claimed eligibility for concessional duty under Notification No. 83/90-Cus. The Tribunal found merit in allowing them to pay duty on HMS and remanded the case for further consideration.

4. The issue of Countervailing Duty (CVD) at Rs.1,000/- PMT under Notification No. 44/93-C.E. was raised, with the appellant asserting the availability of CVD paid as credit. The adjudicating authority was directed to consider this during re-adjudication.

5. The Tribunal differentiated the present case from the Supreme Court decision cited by the Departmental Representative, emphasizing that as the goods were not covered by the DEEC licence, extending benefits under Notification No. 203/92 was inappropriate. The appeal was allowed by remand for a fresh decision, considering the arguments presented.

This detailed analysis outlines the key issues, arguments, and the Tribunal's decision, providing a comprehensive understanding of the legal judgment.