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2017 (5) TMI 88 - AT - Central ExciseNSEZ - Clandestine removal - diamonds - After manufacturing of the diamond jewellery at the zone, the same were clandestinely removed in domestic area from the zone without payment of applicable duty - Held that - from the record, it appears that while computing duty, the adjudicating authority has not applied independent mind for the reason that they have not examined on merit the aspect of the benefit pertaining to the Special Additional Duty of Customs (SAD) and Additional Duty of Customs, Countervailing Duty (CVD). The authority has also not examined in detail the Work in Progress (WIP) Register where no deficiency was found as per the statement of the learned counsel for the assessee-Appellants - the matter is remanded for the limited purpose to examine de novo the benefit in computation as well as the amount mentioned in the Work in Progress (WIP) Register pertaining to the assessee-Appellants - appeal allowed by way of remand.
Issues Involved:
- Misuse of NEPZ facilities and evasion of excise duty - Jurisdiction of Commissioner of Customs (Exports), New Delhi - Benefit of Additional Duty of Customs - Countervailing Duty (CVD) and Special Additional Duty of Customs (SAD) not given - Incorrect computation of duty and penalty imposition - Seizure of goods and passing of impugned order - Clandestine removal of manufactured diamond jewellery without duty payment Analysis: Misuse of NEPZ facilities and evasion of excise duty: The appeals were filed against the Order-in-Original passed by the Commissioner of Customs (Exports), New Delhi, alleging misuse of NEPZ facilities and duty evasion. The Department seized jewellery, diamonds, gold, and other items from a vehicle exiting NEPZ. The Department demanded duty and imposed penalties. The appellants contested the allegations, claiming compliance with regulations and challenging the duty computation and penalty imposition. Jurisdiction of Commissioner of Customs (Exports), New Delhi: During the arguments, the jurisdiction of the Commissioner of Customs (Exports), New Delhi was challenged by the appellants. However, the Department supported the impugned order, citing a Board Circular specifying the jurisdiction of handling Export Oriented Units (EOUs). The Tribunal dismissed the challenge to the jurisdiction based on the Circular's provisions. Benefit of Additional Duty of Customs - CVD and SAD not given: The appellants argued that the duty computation did not consider the benefit of Additional Duty of Customs - Countervailing Duty (CVD) and Special Additional Duty of Customs (SAD). They filed Misc. Applications to rectify this omission. The Tribunal acknowledged this issue and remanded the matter for a fresh examination to include these benefits in the duty calculation. Incorrect computation of duty and penalty imposition: The Tribunal found discrepancies in the duty computation and penalty imposition. While upholding the duty demand due to clandestine removal of goods, it noted that the adjudicating authority did not apply an independent mind in considering the benefits like SAD and CVD. The matter was remanded for a detailed review of these aspects, providing the appellants with an opportunity to present their case and submit additional documents. Seizure of goods and passing of impugned order: The Department seized goods and passed the impugned order alleging duty evasion and misuse of NEPZ facilities. The Tribunal examined the records and upheld the duty demand based on evidence of clandestine removal of manufactured diamond jewellery without duty payment. However, it directed a fresh review of the duty computation and Work in Progress Register to ensure a fair assessment. Clandestine removal of manufactured diamond jewellery without duty payment: The Tribunal found evidence that the appellants dispatched diamonds to their manufacturing unit without proper documentation, leading to clandestine removal of diamond jewellery without duty payment. While upholding the duty demand, the Tribunal ordered a reevaluation of the duty computation and Work in Progress Register to rectify deficiencies and provide a fair opportunity for the appellants to present their case. This detailed analysis covers the key issues involved in the legal judgment, addressing the arguments presented by both parties and the Tribunal's decision on each aspect of the case.
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