2018 (9) TMI 1081 - AT - Customs

Demand of Special Additional Duty (SAD) in cash - case of appellant is that SAD, has to be paid in cash and cannot be paid by debiting the DFCE scrips - N/N. 53/2003 - allegation of the Department is that since the appellants have not paid it by cash, there is short payment of duty - Held that - Once the duty has been paid by debiting in the same, the appellant has suffered duty. Only the manner of payment of duty is not in accordance with law. If the appellant had been put to notice while debiting in the DFCE scrips, he would have opted to pay the SAD by cash itself. Instead, after a period of almost four months, the Show Cause Notice has been issued alleging short payment of duty. There is only error in the manner of payment of duty. For this reason, the appellant cannot be called upon to pay duty for the second time - Demand cannot sustain - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Restoration of appeal dismissed for non-prosecution and on monetary limits.
2. Interpretation of Notification No. 53/2003 regarding payment of Special Additional Duty (SAD) through DFCE scrips.

Issue 1: Restoration of Appeal
The appellant filed an ROA application seeking to restore the appeal that was dismissed for non-prosecution and on monetary limits. The appellant claimed they did not receive any hearing notice, leading to their non-appearance during the proceedings. The Department opposed the application, stating the appeal had been adjourned multiple times at the appellant's request. After considering both sides' arguments, the Tribunal found that the appellant deserved a chance to contest the case on merits. Consequently, the ROA application was allowed, and the appeal was restored.

Issue 2: Interpretation of Notification No. 53/2003
The appellant had paid SAD by debiting from DFCE scrips, leading to a demand for cash payment of SAD through a Show Cause Notice. The appellant argued that the duty was paid, albeit through debiting in the scrips, and there was no actual short payment of duty. The Department contended that SAD could not be debited from DFCE scrips as per Notification 53/2003, and the appellant should have paid it in cash. Both sides presented their arguments on the interpretation of the notification. The Tribunal held that while the method of payment was incorrect, there was no actual short payment of duty. Considering the peculiar facts and the amount involved, the Tribunal set aside the demand, ruling in favor of the appellant.

In conclusion, the Tribunal allowed the Miscellaneous Application for restoration of the ROA and allowed the appeal with consequential reliefs. The judgment highlighted the importance of proper notification interpretation and the necessity for fair opportunities for appellants to present their case on merits.