2014 (3) TMI 312 - AT - Central Excise

100% EOU - Clearance of Capital goods to another EOU - appellant has not produced the original copy of the re-warehousing certificate - Held that - As per Rule 20 of the Central Excise Rules, 2002 if the consignor failed to produce re-warehousing certificate in case liability of duty cast on the consignee and not on the consignor. Admittedly, appellant is a consignor. Further in the case of Skyron Overseas (2009 (10) TMI 372 - CESTAT, AHMEDABAD) the facts were that the assessee was 100% EOU engaging in the manufacture of yarn. They cleared two consignments to another EOU. The show-cause notice came to be issued to them as they failed to produce re-warehousing certificate therefore they have to pay the duty - appellant are not liable to pay duty as it is not in dispute that the goods have not been supplied to another EOU - Following decision of SKYRON OVERSEAS Versus COMMISSIONER OF C. EX., SURAT 2009 (10) TMI 372 - CESTAT, AHMEDABAD - Stay granted.

Summary

Issues:
Appeal against confirmed demands due to missing re-warehousing certificate.

Analysis:
The appellant, a 100% EOU, appealed against demands confirmed by lower authorities for not producing the original re-warehousing certificate. The appellant argued that under Rule 20(3) of Central Excise Rules, 2002, if the certificate is not produced, the liability falls on the consignee, not the consignor. Citing the case of Skyron Overseas vs. CCE 2010 (252) ELT 293, the appellant contended that responsibility for the certificate lies with the consignee's Superintendent, absolving the appellant of duty payment.

The respondent contended that it is the duty of the consignor to file the re-warehousing certificate within 90 days of goods dispatch. However, Rule 20 of the Central Excise Rules, 2002 states that if the consignor fails to produce the certificate, the duty liability shifts to the consignee. The Tribunal referred to the Skyron Overseas case where a similar issue arose. In that case, it was established that once the consignor receives the duplicate copy of the certificate and informs the range officer, their statutory obligation ends unless evidence proves diversion of goods. The responsibility for payment of duty cannot be placed on the consignor if no evidence of diversion exists.

Based on the Skyron Overseas case precedent, the Tribunal held that the appellant cannot be held liable for duty payment as the goods were not supplied to another EOU. Consequently, the impugned order was set aside, and the appeal was allowed with any consequential relief. The stay petition was also disposed of accordingly.