1987 (11) TMI 235 - AT - Central Excise

Summary

Issues Involved:
1. Jurisdiction of the North Regional Bench.
2. Export status of the resultant product.
3. Confiscation of goods and imposition of fine.
4. Applicability of Section 111(o) of the Customs Act.

Issue-wise Detailed Analysis:

1. Jurisdiction of the North Regional Bench:
The learned JDR raised a preliminary point questioning the jurisdiction of the North Regional Bench, arguing that the case involves the interpretation of an exemption notification, which should be under the jurisdiction of a Special Bench. The notification in question exempts imported materials from customs duty if used in the manufacture of goods for export. The JDR cited precedents where similar cases were transferred to Special Benches, including a 5-Member Bench decision in the case of Collector of Central Excise, Chandigarh v. Kashmir Vanaspati.

The advocate for the appellant countered that the dispute pertains to whether the resultant product was exported, the possibility of confiscation and fine, and the applicability of Section 111(o) of the Customs Act. They argued that there is no dispute about the rate of duty, hence the case falls within the jurisdiction of the Regional Bench.

The tribunal agreed with the appellant, stating that precedents of similar cases being handled by Special Benches do not oust the jurisdiction of the North Regional Bench in the absence of a speaking order on jurisdiction. The tribunal emphasized that jurisdiction cannot be conferred by the consent of the parties.

2. Export Status of the Resultant Product:
The primary dispute is whether the resultant product mentioned in the advance license was exported. The advocate for the appellant argued that resolving this question would determine whether duty is demandable from the appellant. The tribunal noted that the question is whether the resultant product is 'blankets' or 'druggets,' and once this is resolved, no further question falls for consideration. Therefore, the matter does not involve the interpretation of the exemption notification but rather the fulfillment of the conditions of the advance licensing scheme.

3. Confiscation of Goods and Imposition of Fine:
The tribunal did not delve deeply into this issue but acknowledged it as one of the points of dispute. The advocate for the appellant argued that the confiscation and fine imposed are part of the broader question of whether the conditions of the advance licensing scheme were met.

4. Applicability of Section 111(o) of the Customs Act:
The tribunal considered whether Section 111(o) of the Customs Act is applicable in this case. This section pertains to the confiscation of goods for violation of conditions under which they were imported. The tribunal noted that the determination of whether the resultant product is 'blankets' or 'druggets' would address this issue, as it directly relates to the conditions of the advance licensing scheme.

Conclusion:
The tribunal concluded that the North Regional Bench has jurisdiction to deal with the matter. The precise question for determination is whether the resultant product is 'blankets' or 'druggets.' Once this question is resolved, no further question falls for determination, and the matter does not involve the rate of duty or value of goods. The tribunal emphasized that jurisdiction must be determined based on legal provisions, not practice or consent of the parties.