2017 (5) TMI 1135 - AT - Central Excise

100% EOU - Adjudication done in careless manner - recycling of ferrous and non ferrous scrap - benefit of N/N. 53/97-Cus dated 03.06.1997 - cumulative NFE - Held that - the Tribunal vide its order APEX RECYCLING PVT. LTD. Versus COMMISSIONER OF CENTRAL EXCISE, DELHI-I 2008 (8) TMI 64 - CESTAT NEW DELHI had given two fold directions to be followed at the time of de novo adjudication. The second direction, where matter was to be sent to the Development Commissioner for calculation of the cumulative NFE and his direction for de-bonding, was to be complied with after adjudication of the valuation issue - both the parties have agreed that the second condition has not been complied with in the impugned order - we approve the impugned order regarding the discussion on the valuation issue but is set aside to facilitate and remand the matter back to the original authority to comply with the direction no. 2 pertaining to Development Commissioner for calculation of cumulative NFE - appeal allowed by way of remand.

Summary

Issues:
1. Duty demand sustained in impugned order.
2. Compliance with directions given in previous Tribunal order for de novo adjudication.
3. Valuation issue and calculation of cumulative Net Foreign Exchange (NFE).
4. Adjudication of mis-declaration of value and description of imported goods.
5. Compliance with Development Commissioner's directions for de-bonding.

Analysis:
1. The appeal was filed against Order-in-Original No. 34/D-I/2009 dated 10.12.2009 concerning a 100% EOU engaged in recycling ferrous and non-ferrous scrap during the disputed period of 2001-08. The appellant imported metal scrap duty-free under notification no. 53/97-Cus dated 03.06.1997, subject to fulfilling positive Net Foreign Exchange (NFE) conditions. Irregularities were found during a search, leading to seizure of items provisionally released under a High Court directive.

2. The Tribunal, in a previous order dated 26.08.2008, remanded the matter back to the original authority for de novo adjudication with specific directions. These directions included two stages of adjudication: first, on mis-declaration of value and description of imported goods, and second, on the calculation of NFE and de-bonding under the Development Commissioner's guidance. The impugned order sustained the duty demand, prompting the appellant to appeal again.

3. The Tribunal found that the second direction regarding compliance with the Development Commissioner's instructions for NFE calculation was not followed in the impugned order. Therefore, the Tribunal approved the discussion on the valuation issue but set aside the order to remand the matter for compliance with the second direction. The adjudicating authority was instructed to comply with the NFE calculation within three months, allowing fresh evidence if necessary.

4. Both parties acknowledged the non-compliance with the second direction during arguments. Consequently, the impugned order was modified to facilitate compliance with the Development Commissioner's directions. The Tribunal partly allowed the appeal by remanding the matter back to the original authority for adherence to the specified directions, emphasizing the importance of timely compliance and providing a reasonable opportunity to the appellant for any additional evidence.

This detailed analysis highlights the key issues addressed in the judgment, focusing on duty demand, compliance with Tribunal directions, valuation issues, and the calculation of Net Foreign Exchange requirements.