9911796707
TMI Blog2009 (10) TMI 489X X X X Extracts X X X X X X X X Extracts X X X X ..... ts and Exports (Control) Act, 1947 (for short the Act, 1947). 2. The facts undisputed, are that the petitioner company has entered into a memorandum of understanding with 'Energy Conversion Devices Inc., of USA' (ECD) with mutual obligations, where under the said ECD has agreed to provide the technology and with buy-back 50% of the installed capacity. Accordingly, the petitioner company submitted an application-dated 20-8-1986 to the Secretariat of Industrial Approvals, Government of India for issuance of letter of intent or industrial licence as contemplated under the Rules. However, the said letter of intent was granted on 19-4-1988 i.e., after lapse of period of 20 months. Immediately, the petitioner applied for conversion of the letter of intent into industrial licence on 12-12-1988. The said licence was issued on 26-12-1999, again with a delay of 12 months. The petitioner states that normally such licence has to be issued within a period of six weeks only and in terms thereof the licence was granted as late as on 24-7-1991. Under the said licence, the petitioner is permitted to manufacture "Photovoltaic Cells, Modules and products/systems based on Amorphous Ssilicon". The co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... current Industrial Licencing Policy. 3. On submission of 23 Ex-bond bills of entry for assessment of duties under the Customs Act and Rules thereunder on 29-12-1995, the Assistant Commissioner of Excise passed an order on 5-2-1996 assessing the duties and penalty at Rs. 36,82,917/-. Aggrieved thereby, the petitioner has filed an appeal to the Commissioner (Appeals) Customs and Central Excise, Hyderabad, which was dismissed on a technical objection of non-compliance of pre-deposit for an appeal. Meanwhile, as per the letter dated 22-3-1996, the Development Commissioner, Visakapatnam Export Processing Zone, intimated the Excise Authorities and the petitioner that 10% penalty on CIF value of the imported capital goods for non fulfillment of export obligation was exempted and sought for necessary action for issue of final debonding letter after fulfilling the conditions. 4. Therefore, the case of the petitioner is that the total liability towards duty payable for debonding and withdrawal of 100% EOU, since pending before the Assistant Commissioner of Central Excise, in terms of the order of the remand passed in Appeal by the CEGAT, where substantial questions affecting the rights a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion on 2-2-1995. This was followed by letter dated 8-8-1995 by the Government of India revising the conditions of debonding. The Visakapatnam Export Processing Zone, through its Development Commissioner by letter dated 22-3-1996 waived 10% penalty. Later issued a revised show cause on 31-10-1996, for which again the petitioner has filed an explanation dated 13-11-1996. Thereupon, fresh orders dated 5-12-1996 and addendum to the orders was passed on 5-12-1996 itself. Later another show cause notice dated 11-10-1999 was issued by the Visakapatnam Export Processing Zone, for which, the petitioner submitted explanation dated 26-10-1999. It is to be noticed that the very same authority has issued a suo motu debonding letter dated 2-1-2000 and the Joint Development Commissioner issued similar suo motu debonding letter on 10-2-2000, which was again followed by a fresh show cause notice dated 17-1-2002, for which the petitioner submitted explanation on 19-2-2002. The order of the Appellate Authority CEGAT dated 21-1-2003 [2003 (156) E.L.T. 391 (Tri - Bang.)] whereupon the petitioner has submitted a letter dated 23-5-2003 enclosing challans in terms of another application filed by the petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore debonding, therefore, the petitioner cannot have any excuse of whatsoever nature to wriggle out of the liability for penalty. Therefore there are no merits and the writ petition is liable to be dismissed. 9. Heard in detail from both sides, Sri D. Prakash Reddy, learned senior counsel appearing for petitioner and Sri A. Rajashkar Reddy, learned Assistant Solicitor General on behalf of the respondents. 10. Taking into account all the varied submissions from both sides and on reading of the material on record, the point which emanates for consideration is as to whether on the facts and circumstances of the case, the provisions of Section 4-I of the Act, 1947 are applicable and the petitioner is liable for penalty. 11. For proper appraisal, it necessitates to read Section 4-I of the Act, 1947 which reads as follows ; "4-I :- Liability to penalty : - (1) Any person who,- (a) in relation to any goods or materials which have been imported under any licence or letter of authority, uses or utilizes such goods or materials otherwise than in accordance with the conditions of such licence or letter of authority; shall be liable to a penalty not exceeding five times the value of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The delay as pointed out is virtually runs to almost 54 months from 20-8-1986 to final approval by IDBI on 20-2-1991. The petitioners cannot be blamed on this account. There is no dispute to the fact that the party at the other end viz., ECD sold itself to M/s. Cannon a multinational company of Japan and a new establishment under the name and style "United Solar Systems Corporation exist in the year 1991. Further the said new company in parallel sought to establish another unit on the same lines as that of the petitioner's Phase-I in the land situate at border of Mexico and tried to take advantage of NAFTA agreements and fresh agreements of goods between US and Mexico. There is thus a total remission on the part of the said new company at the other end which has lead the petitioner to opt for alternatives apart from pursuing exports to the extent possible. Even this fortuitous circumstances are not within the bounds of the petitioner. The petitioner admittedly exported to a tune of Rs. 68.09 lakhs, no doubt far below the original quantity. However, the respondents have acted upon the application filed by the petitioner on 12-3-1992 seeking for debonding for the purpose of domesti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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