2020 (10) TMI 1137 - AT - Customs

EPCG Scheme - non-fulfilment of export obligation - Customs Notification No.64/2008-C.E., dated 09.05.2008 - HELD THAT - Since the appellant submits that it had already achieved the export obligation against the goods imported by it, we are of the view that the adjudged demands cannot be confirmed on the appellant on the ground of non-fulfilment of the export obligation - However, since the facts regarding achievement of export obligation are required to be examined at the original stage, the matter should be remanded to the original authority for verification of the documentary evidences for a proper satisfaction of the fact that the export obligation in respect of the imports made under EPCG licence had already been achieved by the appellant. Appeal allowed by way of remand.

Summary

Issues:
- Early hearing of appeal based on export obligation fulfillment under EPCG license
- Denial of exemption benefit, customs duty recovery, confiscation of goods, redemption fine, and penalty imposition

Issue 1: Early Hearing of Appeal
The appellant sought early hearing of the appeal due to having fulfilled the export obligation concerning imports made under the EPCG license. The Tribunal allowed the miscellaneous application for early hearing, considering it in the interest of justice. The appeal was taken up for hearing and disposal promptly with the consent of both parties.

Issue 2: Denial of Exemption Benefit and Customs Duty Recovery
The appellant imported capital goods under an EPCG license but was alleged to have not fulfilled the conditions specified in the bond, license, and relevant Customs notification. Consequently, proceedings were initiated, leading to an adjudication order denying exemption benefit, ordering customs duty recovery of ?88,82,117, along with interest. The order also included confiscation of imported goods with an option for redemption on payment of a fine and imposed a penalty of ?12,00,000 under the Customs Act, 1962.

Analysis:
The Tribunal noted the appellant's claim of having met the export obligation related to the EPCG license. The appellant's consultant argued that the export obligation fulfillment was endorsed by the DGFT, who issued the EPCG license. In contrast, the Revenue's representative supported the findings of the adjudicating authority. Upon hearing both parties and reviewing the records, the Tribunal found that the demands imposed on the appellant for non-fulfillment of export obligations could not be sustained if the obligations were met. However, to verify the actual achievement of export obligations, the matter was remanded to the original authority for a fresh adjudication, ensuring the appellant's right to a personal hearing.

In conclusion, the appeal was allowed by remanding the case for a thorough examination of the export obligation fulfillment. The decision emphasized the importance of verifying documentary evidence to confirm the appellant's claim.