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Issues involved: Stay application, waiver of pre-deposit, duty payment, export obligation fulfillment, penalty imposition, machinery confiscation.
Stay Application and Waiver of Pre-deposit: The Appellate Tribunal, after hearing both sides on the stay application, decided to take up the appeal for disposal and granted a waiver of pre-deposit of Rs. 3 lakhs imposed upon the appellant as penalty in the impugned order. Duty Payment and Export Obligation Fulfillment: The appellant imported machinery under a concessional duty rate but failed to fulfill the export obligation as per the Notification. The Commissioner alleged non-fulfillment of export quota, leading to a demand for duty and interest. However, the appellant argued that duty was paid prior to the show cause notice and that failure to export was due to reasons beyond their control. Citing a Tribunal judgment, the appellant contended that there was no intent for non-compliance and hence no basis for penalty imposition. Penalty Imposition and Machinery Confiscation: The Commissioner imposed a penalty of Rs. 3 lakhs on the importer along with confiscation of the machinery, allowing redemption on payment of a fine of Rs. 15 lakhs. The Revenue supported the Commissioner's decision, stating that failure to comply with obligations would result in fines and penalties. However, the Tribunal found that there was no breach of the exemption condition as duty was paid within the specified period. It was noted that there was no willful intent to gain financial benefit without fulfilling the export obligation, leading to the allowance of the appeal based on the cited judgment's principles.
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