2021 (3) TMI 364 - HC - Customs

Confiscation - imposition of redemption fine - DEEC Scheme - respondents had not utilized the duty free materials for manufacturing of Aluminium Extrusions that were sold in domestic market, in violation of the conditions of the exemption notification - interest and penalty imposed on the 2nd respondent - respondent no. 2 on the role of the Managing Director in the misuse of DEEC Scheme committed by the firm was well established by the Department. HELD THAT - The Tribunal, by the impugned order, had remanded the matter back to the Assessing Officer to verify the claim made by the assessee that they exported over 14 tonnes of goods with the imported aluminium ingots, which were cleared by the respondent through the customs, without payment of duty under the DEEC Scheme - there was no material available with the Department at the relevant point of time to rebut the plea raised by the assessee that they exported over 14 tonnes utilizing the imported material, which were cleared without payment of duty under the DEEC Scheme. Therefore, the Tribunal thought fit to remand the matter to the Assessing Officer for a fresh consideration. We find no error in such direction being issued by the Tribunal. Since the Tribunal thought fit to remand the matter back to the Assessing Officer, it has to necessarily interfere with the order of the Assessing Officer - Appeal dismissed.

Summary

Issues:
1. Setting aside of confiscation and imposition of Redemption Fine and interest on duty.
2. Setting aside of interest and penalty imposed on the Managing Director.

Analysis:
1. The appellant-Department challenged the order of the Customs, Excise & Service Tax Appellate Tribunal, which set aside the confiscation and imposition of Redemption Fine and interest on duty. The first issue raised was whether the Tribunal was correct in its decision considering that the respondents had not utilized duty-free materials for manufacturing Aluminium Extrusions sold in the domestic market, violating exemption notification conditions. The Tribunal remanded the matter to verify the claim that over 14 tonnes of goods were exported using imported aluminium ingots cleared without duty under the DEEC Scheme. The Tribunal found no material to rebut the claim, leading to the remand for fresh consideration by the Assessing Officer. The Tribunal's decision to remand was upheld as no error was found in this direction.

2. The second issue involved the setting aside of interest and penalty on the Managing Director for his role in the misuse of the DEEC Scheme. The appellant argued that the Tribunal's decision to set aside confiscation, interest, and penalty was incorrect. However, since the matter was remanded to the Assessing Officer, the Tribunal had to interfere with the Assessing Officer's order. The High Court found no substantial question of law arising from the appeal and dismissed the Civil Miscellaneous Petition without costs, along with the connected miscellaneous petition.