2023 (5) TMI 1351 - AT - Customs

Violation of provisions of notification No.64/2008-Customs dated 09.05.2008, in terms of the show cause proceedings or not, for deciding on the issue of legality of the impugned order - confiscation of goods - imposition of redemption fine - demand of customs duty and interest - HELD THAT - The issues arising out of the case and allegations raised in the show cause notice have not been discussed with respect to available documents and case records, various submissions made by the appellants before the original authority, by the learned Commissioner of Customs (Export) in the impugned order, to arrive at the conclusion whether the conditions of the Notification No.64/2008-Customs dated 09.05.2008 have been fulfilled or these have been violated by the appellants. The impugned order lacks appreciation of facts on record and the documents submitted by the appellants which are relevant to the issues of the case, for arriving at a proper decision. There is no discussion or not even a mention of the document produced by the appellants in respect of installation certificate dated 05.04.2009. Thus, the impugned order has not considered all relevant aspects of the case and ignored crucial documents. The matter needs to be looked into afresh by the original authority for determining the correct position of law in this case - appeal allowed by way of remand.

Summary

Issues Involved:
1. Violation of EPCG license conditions.
2. Non-compliance with Customs notification No. 64/2008-Cus.
3. Confiscation of imported goods.
4. Demand of duty payable.
5. Imposition of penalties.

Issue-wise Detailed Analysis:

1. Violation of EPCG License Conditions:
The appellants, M/s R.K. Mining Pvt. Ltd., were accused of violating several conditions of the EPCG license, including:
- Not installing the crushing plants at the declared place (Condition No. 9).
- Not maintaining required records (Para 5.15 of the Hand Book of Procedures 2004-09).
- Not using the imported machinery for the intended purpose of mining and excavating iron ore (Condition No. 6).
- Not submitting installation certificates within six months from the date of import (Condition No. 14).

The appellants argued that they had obtained necessary permissions from DGFT for shifting the machinery and had fulfilled the export obligations. They provided an installation certificate issued on 07.05.2012 and claimed compliance with the legal requirements.

2. Non-compliance with Customs Notification No. 64/2008-Cus:
The appellants were alleged to have shifted the crushing plants to the project site of their sister concern without completing the export obligation, thus violating the provisions of the notification. The appellants contended that they had obtained permission from DGFT for the shifting and had applied for discharge of export obligation.

3. Confiscation of Imported Goods:
The Commissioner of Customs ordered the confiscation of the imported machinery under Section 111(o) of the Customs Act, 1962, and imposed a redemption fine of Rs. 1,00,00,000/-. The appellants argued that the machinery was installed at the declared site initially and later shifted with due permission from DGFT.

4. Demand of Duty Payable:
The Commissioner confirmed the customs duty demand of Rs. 1,27,17,014/- under the proviso to Section 28(1) of the Customs Act, 1962, and appropriated the voluntary deposit made by the appellants towards this liability. The appellants maintained that they had complied with the conditions of the notification and provided necessary documentation.

5. Imposition of Penalties:
Penalties were imposed on the appellants and their directors under Sections 112(a), 112(b), and 114A of the Customs Act, 1962. The appellants contended that the penalties were unwarranted as they had obtained necessary permissions and fulfilled the export obligations.

Judgment:
The Tribunal found contradictions in the findings of the original authority and noted that the conditions of the notification had been fulfilled in several respects. The impugned order lacked appreciation of facts and relevant documents, such as the installation certificate dated 05.04.2009. Consequently, the Tribunal set aside the impugned order and remanded the case for fresh de novo adjudication, directing the original authority to consider all relevant documents and submissions made by the appellants.