2001 (11) TMI 79 - SC - Central Excise

Whether the appellant was not entitled to the benefit of duty free import as it had violated condition no. (V) (a) of the notification Notification No. 203/92 dated 19th May 1992? Held that - The appellant had at no stage took the plea that it was not reasonably possible for it to segregate inputs utilized in the manufacture of the dutiable final products from the final products which are exempted from duty. Now the appellant cannot be permitted to raise such a new plea. Appeal dismissed.

Summary

Issues:
1. Interpretation of conditions under Notification No. 203/92 for duty-free import.
2. Allegations of availing modvat credit against the licensing scheme.
3. Application of Circular dated 3rd January, 1997 and Amnesty Scheme.
4. Compliance with the provisions of the Amnesty Scheme.
5. Tribunal's decision on penalty, interest, and duty liability.
6. Justification for denying benefit under the Amnesty Scheme.
7. Interpretation of the Amnesty Scheme's provisions.
8. Legal implications of the orders in M/s. Raj Exports v. National Aluminium Co. & Ors.
9. Compliance with Notification No. 203/92 regarding segregation of inputs.
10. New plea regarding segregation of inputs not permissible.

Analysis:
1. The case involved the appellant importing Polypropylene under the Value Based Advance Licensing Scheme, claiming duty-free clearance under Notification No. 203/92. The department alleged violation of condition (V) (a) of the notification, requiring discharge of export obligations using goods without input stage credit under Central Excise Rules.

2. The department issued a show cause notice alleging suppression of availing modvat credit on inputs used for exported goods, leading to wrongful duty-free benefits. The appellant contended it had reversed the credit in 1994 and cited the Circular dated 3rd January, 1997, and the subsequent Amnesty Scheme for relaxation.

3. The Amnesty Scheme, introduced after the Circular, required depositing interest on reversed modvat credit by a specified date. The Commissioner found the appellant did not meet the Scheme's conditions, leading to imposition of duty, interest, and penalty.

4. The Tribunal partially upheld the appeal, setting aside penalties but confirming duty liability. The appellant contested denial of Amnesty Scheme benefits, citing the reversal of credit before the Scheme's enforcement.

5. The appellant argued that the interest deposit deadline was missed due to reliance on previous court orders, but the Court emphasized strict adherence to Scheme provisions without room for extension.

6. The Court rejected the appellant's argument, emphasizing the need for timely interest deposit as per the Scheme's clear terms, citing precedents and dismissing the appeal with costs.

7. The Court also addressed the appellant's claim regarding segregation of inputs, noting that raising new pleas at a later stage was impermissible.

This detailed analysis covers the various issues and legal interpretations involved in the judgment, providing a comprehensive understanding of the case.