2017 (5) TMI 1072 - AT - Customs

100% EOU - confiscation - penalty - demand on the ground that permission was not sought for export - Held that - It is also not in dispute that the appellant was not of aware of the fact that the goods supplied by the overseas supplier was of Indian origin and not of Chinese origin. Later, realizing the mistake, the overseas supplier agreed to take back the material and on the request of the appellant, the ld. commissioner of Customs allowed export of the said goods which in fact was exported on 23.2.2008 against Shipping Bill No.6045064 dated 18.2.2008 - the finding of the ld. Commissioner of Customs that no permission for export of the said goods was accorded to the appellant, is thus incorrect and therefore, the conclusion reached by the ld. Commissioner also becomes erroneous - appeal allowed - decided in favor of appellant.

Summary

Issues:
Appeal against Order-in-Original for confiscation of goods, duty demand, penalty, and personal penalty.

Analysis:
The case involved an appeal against an Order-in-Original passed by the Commissioner, Central Excise Customs & Service Tax Daman, regarding the confiscation of goods, duty demand, penalty, and personal penalty. The appellants, a 100% EOU engaged in manufacturing Agro Chemicals, had imported 18000 kgs of Meta Phenoxy Benzaldehyde from Hong Kong, China, but it was later discovered that the goods were of Indian origin, not Chinese as declared. The goods were seized, released provisionally, and a show cause notice was issued proposing confiscation, duty recovery, and penalties. The adjudication confirmed duty demand, imposed penalties, and allowed redemption of goods on payment of a fine. The appeals were filed against these decisions.

The appellants argued that the overseas supplier had wrongly dispatched the consignment, admitted the mistake, and agreed to take back the goods at their own cost. The Commissioner was informed, and re-export of the goods was allowed. Despite providing all export documents to the adjudicating authority, a finding was erroneously made that no permission for re-export was granted. The appellants relied on precedents where penalty and confiscation were deemed unwarranted once goods were re-exported due to the supplier's mistake.

The Revenue was directed to verify the claim of re-export, and it was confirmed that the goods were indeed exported. The Tribunal noted that the appellants were unaware of the goods' true origin, and upon realizing the mistake, the overseas supplier agreed to take back the material. The Commissioner's finding that no permission for export was granted was deemed incorrect. Relying on the precedents cited by the appellants, the Tribunal found no merit in the impugned order. Consequently, the order was set aside, and the appeals were allowed with any consequential relief as per law.