2014 (4) TMI 657 - AT - Customs

Exemption of Duty - Export of goods not permitted by LOP - NEPZ, Noida Duty on manufacture and export of syringes - Whether the case was covered under Rule 8 of the Customs (Import of Goods at concessional rate of duty for manufacturing of excisable goods) Rules, 1996 or covered by Notification No. 53/97 and the Board circular No. 21/1995, as amended by Notification No. 122/95-Cus Held that - In the case of same assessee while disposing appeal No. C/580/2008 this court noticed that when the assessee had shown wastage and scrap of the imported material meant for use in the manufacture of syringes with or without needle, unless the waste and scrap aspect is reconciled for the period November, 96 to April, 2003 it is difficult to reach to any conclusion prematurely about the export or no export of 2,35,54,000 pieces of cannulae - Unless cannulae is properly accounted for it is difficult to hold the manufactured quantity of specific goods were exported - Therefore, it is required to be ensured that the claim of waste and scrap as that is in appeal No. C/580/2008 should not grant undue advantage to the plea of export in the present appeal - Present Appeal is also remanded to the Adjudicating Authority for common disposal along with the controversy in C/580/2008 Decided in favour of Revenue.

Summary

Issues:
1. Allegation of contravention of conditions of LOP dated 22.09.1995 by the appellant.
2. Recoverability of duty involved in imported raw material and Central Excise duty on exported needles.
3. Show Cause Notice issued to the appellant and subsequent adjudication.
4. Appeal filed by the respondents against the order of adjudication.
5. Reconsideration of the entire issue by the Commissioner (Appeals).
6. Re-adjudication order by the adjudicating authority.
7. Appeal by the Revenue against the re-adjudication order.
8. Arguments presented by both the Revenue and the Respondent.
9. Examination of the case by the Tribunal and remand to the Adjudicating Authority.

Issue 1:
The appellant exported needles without obtaining permission, leading to contravention of LOP conditions. Customs Import Duty and Central Excise duty were demanded, invoking extended periods under relevant laws.

Issue 2:
The Show Cause Notice issued to the appellant was adjudicated, confirming the duty demands and imposing penalties under Customs Act, 1962, and Central Excise Act, 1944.

Issue 3:
The respondents appealed the adjudication order, leading to a remand by the Commissioner (Appeals) for reconsideration based on specific points related to Customs rules, time-barring of demands, and diversion of needles for home consumption.

Issue 4:
The re-adjudication order by the adjudicating authority held the case as one of export not included in LOP, thus not liable for duty. It also dismissed allegations of suppression of facts and fraud against the respondent.

Issue 5:
The Commissioner (Appeal) observed that the LOPs allowed the manufacture and export of syringes with or without needles, indicating no prohibition on exporting needles. The appeal was rejected based on the regular submission of documents by the respondent and lack of evidence of diversion for home consumption.

Issue 6:
The Revenue appealed the Commissioner (Appeal) decision, arguing that the export of needles without authority violated LOP norms, justifying duty demands and extended limitation periods due to suppression of facts.

Issue 7:
The Respondent contended that the LOPs allowed the export of syringes with or without needles, and the regular submission of documents supported their case. They argued that the appeal rejection was justified based on lack of dues pending and time-barring of the Show Cause Notice.

Issue 8:
The Tribunal examined both sides' arguments and records, noting a previous case involving the same appellant regarding imported Cannulae and Needles. The case was remanded for further consideration to reconcile the waste and scrap aspect for a conclusive decision.

Issue 9:
The Tribunal remanded the case to the Adjudicating Authority for common disposal with another related matter, emphasizing the need for reconciliation and fact-finding to determine the limitation issue based on conduct and findings during the proceedings.