2017 (5) TMI 1185 - AT - Central Excise

Short shipment/export of Concentrates (goods) of the certain quantity of the zinc and lead concentrate with reference to the goods cleared from the factory for export under Bond - demand - Held that - the impugned order has raised a new issue saying that there may be possibility that the goods cleared under these ARE-1s have been diverted. This observation is mentioned in the impugned order in respect of four ARE-I mentioned in the table in para 21 of the impugned order - appellant states that all the evidences for export of the subject goods are available with them - the matter deserves to be remanded to Commissioner for fresh adjudication, where the appellant shall be given opportunity of personal hearing and submission of relevant documents to prove the fact of export of goods - appeal allowed by way of remand.

Summary

Issues:
Appeal against Order-in-Original confirming Central Excise duty demand, determination of quantity for lead and zinc concentrates, short shipment/export of concentrates, re-examination of duty demand, absence of endorsement on ARE-1s for goods exported, possibility of diversion of goods, availability of evidence for export, remarks of Customs authorities, remand for fresh adjudication.

Analysis:
The case involves an appeal by M/s Hindustan Zinc Ltd. against the confirmation of a Central Excise duty demand of ?22,67,698/- in connection with the export of lead and zinc concentrates. The concentrates are measured as Wet Metric Tonne (WMT) but valued based on Dry Metric Tonne (DMT) due to moisture content. The issue arose when the WMT quantity mentioned in the AR-4 forms did not match the actual quantity shipped, leading to a discrepancy in exported quantities. The initial duty demand was contested, and the matter was remanded for re-examination by CESTAT in 2005.

In the subsequent adjudication, the Commissioner observed discrepancies in the documentation, particularly the absence of endorsements on ARE-1s regarding the arrival of goods at the port of export. The order also highlighted the lack of additional documents like shipping bills or bill of lading to confirm the export process. The Commissioner confirmed the duty demand based on these findings, raising concerns about possible diversion of goods cleared under the ARE-1s.

During the hearing, both counsels presented their arguments, with the appellant asserting the availability of export evidence and referencing previous customs endorsements as proof. The Revenue's counsel highlighted potential challenges in verifying export remarks for the specific ARE-1s in question. Ultimately, the Tribunal decided to remand the case back to the Commissioner for fresh adjudication.

The Tribunal directed the Commissioner to allow the appellant an opportunity for a personal hearing and submission of relevant export documents. The focus of the fresh adjudication would be to verify the export facts and address any discrepancies in exported quantities based on DMT measurements. The modification of the impugned order and the allowance of the appeal were contingent on the outcome of this re-examination, emphasizing the importance of accurate documentation and verification in duty assessments related to exported goods.