2017 (11) TMI 725 - HC - Central Excise

EPCG License - N/N. 110/95-Cus - Concessional Rate of Duty - Held that - From the first order, the direction which has been issued to the authority was very clear that the authorities below cannot stand by the Board circular that the period of warehousing has already expired. In these circumstances, we find it to be a fit case for reconsideration in the light of Board circular. Hence, the order impugned is set aside and the matter is remanded to the adjudicating authority to decide afresh after affording opportunity of hearing to the appellant - Hence, the appeal of the assessee is liable to be allowed. When the Tribunal in first order passed has make it clear that in view of the circular if EPCG Scheme is licenced under EOU it be considered. In that view of the matter, we are of the opinion that both the authorities namely Customs Appeals and the Tribunal has seriously committed an error in not observing the order passed by the earlier authority namely Tribunal in Customs Appeals dt. 23/1/2003 - the appellant is entitled to the benefit of circular. The same will be given to him and the goods will be released in the export 100% export oriented unit subject to the fulfilment of the condition. Appeal dismissed - decided against Revenue.

Issues:
1. Challenge to Tribunal's judgment by the department.
2. Import of machine under EPCG license and subsequent application for 100% oriented unit.
3. Appeal sequence and effect on department's appeal.
4. Substantial questions of law framed by the Court.
5. Details of the case regarding import, warehousing, cancellation of licenses, and show cause notice.
6. Disagreement over observations made by authorities.
7. Goods lying in warehouse during the case.
8. Arguments presented by both sides.
9. Tribunal's direction for reconsideration based on Board circular.
10. Decision on appeal of the assessee.
11. Commissioner's observations post remand.
12. Conclusion of the judgment.

Analysis:

1. The department challenged the Tribunal's judgment regarding the appeal filed by the assessee. The case involved the import of a machine under the EPCG license, which was later sought to be treated as a 100% oriented unit. The sequence of hearing the appeals was discussed, emphasizing the potential impact of the assessee's appeal on the department's case.

2. The Court framed substantial questions of law related to the Customs Act provisions and the duty implications on imported goods under different schemes. The case detailed the import process, warehousing, cancellation of licenses, and subsequent show cause notices issued to the assessee.

3. Disagreements arose over the observations made by authorities, with the Commissioner's differing stance post remand. The goods remained in the warehouse during the legal proceedings, leading to further complexities in the case.

4. The Tribunal directed a reconsideration based on the Board circular, highlighting the need for a fresh decision by the adjudicating authority. The appeal of the assessee was ultimately allowed, with the Court emphasizing the importance of interpreting circulars and providing benefits accordingly.

5. The Commissioner's post-remand observations focused on the expired warehousing period and the duty implications on the imported goods. The judgment concluded by dismissing the department's appeal while allowing the assessee's appeal, providing detailed instructions on the release of goods and potential auction procedures if necessary.

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