2000 (3) TMI 102 - AT - Customs

Summary

Issues involved: Alleged contravention of condition 5 of notification 203/92, Modvat credit availed, duty demand, penalty imposition, transfer of advance license, compliance with notification conditions, importer's obligation to demonstrate compliance.

The judgment by the Appellate Tribunal CEGAT, Mumbai involved a case where M/s. MSA Exports and Plast Chem Industries were issued a notice by the Commissioner of Customs alleging contravention of condition 5 of notification 203/92 due to Modvat credit being availed. The Commissioner demanded duty from Plast Chem and imposed a penalty on MSA Exports under Section 114A. MSA Exports' appeal was allowed as no duty was demanded from them. Plast Chem argued that as a transferee of the license, they were not required to prove non-availment of Modvat credit. The Tribunal clarified that the importer must demonstrate compliance with notification conditions, regardless of when the import occurred. The Tribunal disagreed with the view that the licensing authority must verify Modvat credit before permiting license transfer. The decision emphasized the importer's obligation to prove compliance and the department's responsibility to establish any misdeclaration or suppression. The Tribunal highlighted the need for clear evidence to invoke extended periods for duty demand, ultimately allowing both appeals and setting aside the impugned order.